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+ - PROTECTION OF LAWFUL COMMERCE IN ARMS ACT
+
+[House Hearing, 109 Congress]
+[From the U.S. Government Publishing Office]
+
+
+
+ PROTECTION OF LAWFUL
+ COMMERCE IN ARMS ACT
+
+=======================================================================
+
+ HEARING
+
+ BEFORE THE
+
+ SUBCOMMITTEE ON
+ COMMERCIAL AND ADMINISTRATIVE LAW
+
+ OF THE
+
+ COMMITTEE ON THE JUDICIARY
+ HOUSE OF REPRESENTATIVES
+
+ ONE HUNDRED NINTH CONGRESS
+
+ FIRST SESSION
+
+ ON
+
+ H.R. 800
+
+ __________
+
+ MARCH 15, 2005
+
+ __________
+
+ Serial No. 109-21
+
+ __________
+
+ Printed for the use of the Committee on the Judiciary
+
+
+ Available via the World Wide Web: http://www.house.gov/judiciary
+
+
+ ______
+
+ U.S. GOVERNMENT PRINTING OFFICE
+20-015 WASHINGTON : 2005
+_____________________________________________________________________________
+For Sale by the Superintendent of Documents, U.S. Government Printing Office
+Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; (202) 512�091800
+Fax: (202) 512�092250 Mail: Stop SSOP, Washington, DC 20402�090001
+
+ COMMITTEE ON THE JUDICIARY
+
+ F. JAMES SENSENBRENNER, Jr., Wisconsin, Chairman
+HENRY J. HYDE, Illinois JOHN CONYERS, Jr., Michigan
+HOWARD COBLE, North Carolina HOWARD L. BERMAN, California
+LAMAR SMITH, Texas RICK BOUCHER, Virginia
+ELTON GALLEGLY, California JERROLD NADLER, New York
+BOB GOODLATTE, Virginia ROBERT C. SCOTT, Virginia
+STEVE CHABOT, Ohio MELVIN L. WATT, North Carolina
+DANIEL E. LUNGREN, California ZOE LOFGREN, California
+WILLIAM L. JENKINS, Tennessee SHEILA JACKSON LEE, Texas
+CHRIS CANNON, Utah MAXINE WATERS, California
+SPENCER BACHUS, Alabama MARTIN T. MEEHAN, Massachusetts
+BOB INGLIS, South Carolina WILLIAM D. DELAHUNT, Massachusetts
+JOHN N. HOSTETTLER, Indiana ROBERT WEXLER, Florida
+MARK GREEN, Wisconsin ANTHONY D. WEINER, New York
+RIC KELLER, Florida ADAM B. SCHIFF, California
+DARRELL ISSA, California LINDA T. SANCHEZ, California
+JEFF FLAKE, Arizona ADAM SMITH, Washington
+MIKE PENCE, Indiana CHRIS VAN HOLLEN, Maryland
+J. RANDY FORBES, Virginia
+STEVE KING, Iowa
+TOM FEENEY, Florida
+TRENT FRANKS, Arizona
+LOUIE GOHMERT, Texas
+
+ Philip G. Kiko, Chief of Staff-Genral Counsel
+ Perry H. Apelbaum, Minority Chief Counsel
+ ------
+
+ Subcommittee on Commercial and Administrative Law
+
+ CHRIS CANNON, Utah Chairman
+
+HOWARD COBLE, North Carolina MELVIN L. WATT, North Carolina
+TRENT FRANKS, Arizona WILLIAM D. DELAHUNT, Massachusetts
+STEVE CHABOT, Ohio ADAM SMITH, Washington
+MARK GREEN, Wisconsin CHRIS VAN HOLLEN, Maryland
+RANDY J. FORBES, Virginia JERROLD NADLER, New York
+LOUIE GOHMERT, Texas
+
+ Raymond V. Smietanka, Chief Counsel
+
+ Susan A. Jensen, Counsel
+
+ James Daley, Full Committee Counsel
+
+ Stephanie Moore, Minority Counsel
+
+
+ C O N T E N T S
+
+ ----------
+
+ MARCH 15, 2005
+
+ OPENING STATEMENT
+
+ Page
+The Honorable Chris Cannon, a Representative in Congress from the
+ State of Utah, and Chairman, Subcommittee on Commercial and
+ Administrative Law............................................. 1
+The Honorable Melvin L. Watt, a Representative in Congress from
+ the State of North Carolina, and Ranking Member, Subcommittee
+ on Commercial and Administrative Law........................... 3
+The Honorable Steve Chabot, a Representative in Congress from the
+ State of Ohio.................................................. 4
+The Honorable Chris Van Hollen, a Representative in Congress from
+ the State of Maryland.......................................... 6
+The Honorable Howard Coble, a Representative in Congress from the
+ State of North Carolina........................................ 7
+The Honorable John Conyers, Jr., a Representative in Congress
+ from the State of Michigan, and Ranking Member, Committee on
+ the Judiciary.................................................. 8
+The Honorable Louie Gohmert, a Representative in Congress from
+ the State of Texas............................................. 8
+
+ WITNESSES
+
+Mr. Rodd C. Walton, Secretary and General Counsel, Sigarms, Inc.
+ Oral Testimony................................................. 10
+ Prepared Statement............................................. 12
+Mr. Dennis A. Henigan, Director, Legal Action Project, Brady
+ Center to Prevent Gun Violence
+ Oral Testimony................................................. 13
+ Prepared Statement............................................. 15
+Mr. Bradley T. Beckman, Counsel, Beckman and Associates, Counsel
+ to North American Arms
+ Oral Testimony................................................. 25
+ Prepared Statement............................................. 26
+Mr. Lawrence G. Keane, Senior Vice President and General Counsel,
+ National Shooting Sports Foundation, Inc.
+ Oral Testimony................................................. 27
+ Prepared Statement............................................. 29
+
+ APPENDIX
+ Material Submitted for the Hearing Record
+
+Prepared Statement of the Honorable Chris Cannon, a
+ Representative in Congress from the State of Utah, and
+ Chairman, Subcommittee on Commercial and Administrative Law.... 55
+Prepared Statement of the Honorable Cliff Stearns, a
+ Representative in Congress from the State of Florida........... 57
+H.R. 1225, the ``Terrorist Apprehension and Record Retention
+ (TARR) Act of 2005''........................................... 59
+GAO Report entitled ``GUN CONTROL AND TERRORISM: FBI Could Better
+ Manage Firearm-Related Background Checks Involving Terrorist
+ Watch List Records............................................. 62
+The ARMS site description of FN's Five-seveN Pistol.............. 105
+H.R. 1136, the ``Protect Law Enforcement Armor (PLEA) Act''...... 108
+News Articles for the record offered by the Honorable John
+ Conyers, Jr., a Representative in Congress from the State of
+ Michigan, and Ranking Member, Committee on the Judiciary....... 113
+Response to Post-Hearing Questions from a Minority Member to
+ Bradley T. Beckman, Counsel, Beckman and Associates, Counsel to
+ North American Arms............................................ 133
+Article submitted by Lawrence G. Keane, Counsel, Beckman and
+ Associates, Counsel to North American Arms..................... 138
+Op-Ed Article from New York Daily News, Sunday, January 9, 2005,
+ submitted by Lawrence G. Keane, Counsel, Beckman and
+ Associates, Counsel to North American Arms..................... 144
+Letter from Walter Olson, Senior Fellow, Manhattan Institute for
+ Policy Research to the Honorable Chris Cannon.................. 145
+
+
+ PROTECTION OF LAWFUL
+ COMMERCE IN ARMS ACT
+
+ ----------
+
+
+ TUESDAY, MARCH 15, 2005
+
+ House of Representatives,
+ Subcommittee on Commercial
+ and Administrative Law,
+ Committee on the Judiciary,
+ Washington, DC.
+ The Subcommittee met, pursuant to notice, at 10:10 a.m., in
+Room 2141, Rayburn House Office Building, Hon. Chris Cannon
+(Chair of the Subcommittee) presiding.
+ Mr. Cannon. Good morning, ladies and gentlemen. This
+hearing of the Subcommittee on Commercial and Administrative
+Law will now come to order to consider today H.R. 800, the
+``Protection of Lawful Commerce in Arms Act,'' which was
+introduced on February 15 by our colleague from Florida, Mr.
+Stearns. It currently has 157 cosponsors, including me.
+ H.R. 800 addresses abusive lawsuits aimed at the firearms
+industry. It provides that a qualified civil liability action
+cannot be brought in any State or Federal court. Qualified
+civil liability action is defined as a civil action or
+proceeding brought by any person against a manufacturer or
+seller of firearms or ammunition for damages resulting from the
+criminal or unlawful misuse of such products.
+ There are exceptions, however. The bill does not prohibit
+an action against a person who transfers a firearm or
+ammunition knowing that it will be used to commit a crime of
+violence or a drug trafficking crime or to commit an identical
+or a comparable State felony offense. It also does not prohibit
+an action brought against a seller for negligent entrustment or
+negligence per se.
+ The bill also includes several additional exceptions,
+including one for actions in which a manufacturer or seller of
+a qualified product knowingly and willfully violates a State or
+Federal statute applicable to sales or marketing when such
+violation was a proximate cause of the harm for which relief is
+sought. Other exceptions under the bill include one for actions
+for breach of contract or warranty in connection with the
+purchase of a firearm or ammunition and an exception for
+actions for damages resulting directly from a defect in design
+or manufacture of a firearm or ammunition when used as
+intended. The bill also makes clear that only licensed
+manufacturers and sellers are covered by the bill.
+ Tort law rests on a foundation of personal responsibility.
+A product may not be defined as defective unless there is
+something wrong with the product rather than with the product's
+use. However, in the last several years, some lawsuits filed
+against the firearms industry would hold it liable for actions
+of those who use their products in a criminal or unlawful
+manner. Such lawsuits threaten the historic connection between
+tort law and personal responsibility and have forced firearms
+manufacturers into bankruptcy, severely curtailing the recovery
+available for those asserting traditional claims of product
+manufacturing defects.
+ While some of these lawsuits have been dismissed and some
+States have acted to limit them in one way or another, they
+continue to be aggressively pursued. In January, the Supreme
+Court refused to overturn a decision by the Ninth Circuit Court
+of Appeals permitting such frivolous lawsuit against a gun
+manufacturer for a crime committed by a third party. The
+strategy behind these lawsuits is no secret. One of the
+personal injury lawyers suing the firearms industry, John Cole,
+told the Washington Post, quote, ``The legal fees alone are
+enough to bankrupt the industry.'' Professor David Capel also
+stated that the cities suing the firearms industry, quote,
+``don't even have to win. All they have to do is keep suing.
+They'll kill the industry with the cost of defending all the
+lawsuits.''
+ Lawsuits seeking to hold the firearms industry responsible
+for criminal and unlawful use of its products by others are
+attempts to accomplish through litigation what has not been
+achieved by legislation and the democratic process. As
+explained by one Federal judge, quote, ``The plaintiffs'
+attorneys simply want to eliminate handguns.'' Taking advantage
+of our currently unregulated court system, the personal injury
+lawyers are misusing the courts to limit the sale and
+distribution of firearms well beyond jurisdictional boundaries.
+A lawsuit in a single county of a State could destroy a
+national industry, denying citizens everywhere the right to
+keep and bear arms, a right guaranteed by the Constitution.
+ Insofar as these lawsuits have the practical effect of
+burdening interstate commerce in firearms, Congress has the
+authority to act under the Commerce Clause of the Constitution
+as well as the Second Amendment. Such lawsuits also directly
+implicate core federalism principles articulated by the Supreme
+Court, which has made clear that, quote, ``one State's power to
+impose burdens on the interstate market is not only subordinate
+to the Federal power over interstate commerce, but it is also
+constrained by the need to respect the interests of the other
+States.''
+ The direction of this slippery slope is obvious. If the
+judicial system is allowed to eliminate the firearms industry
+based on legal theories holding manufacturers liable for the
+misuse by others of its products, surely those theories will be
+applied to other industries whose products are capable of being
+misused. Knives, for example, are intended and used for non-
+violent purposes. They are virtually indispensable for eating.
+Yet hundreds of thousands of violent crimes every year are
+perpetrated with knives.
+ We have already seen multi-million-dollar lawsuits against
+the makers of hamburgers and steaks for causes--or for damages
+caused when people abuse those products and overeat. Surely the
+manufacturers of steak knives will be sued next when such
+knives are used for criminal purposes.
+ Congress must begin to stem the slide down the slippery
+slope. It can do that by fulfilling its constitutional duty and
+exercising its authority under the Commerce Clause to prevent a
+few State courts from bankrupting the national firearms
+industry and denying all Americans their fundamental right to
+bear arms. We need to preserve the benefit of American-made
+weapons for our soldiers overseas who are so ably defending us
+all from terrorism. Let's not allow the American firearms
+industry to be bankrupted so we're left to rely on foreign
+countries to provide weapons for our own soldiers.
+ I now yield to Mr. Watt, the Ranking Member of the
+Subcommittee, for an opening statement. Mr. Watt?
+ Mr. Watt. Thank you, Mr. Chairman. I apologize to you and
+other Members of the Subcommittee for being a minute or two
+late. I actually was trying to get back on my schedule this
+morning and run for a change and that threw everything off,
+trying to get back on schedule.
+ I guess I find it interesting that the first hearing that
+we are having this year allows me to quote a famous Republican
+former President. ``Here we go again.'' Here you go.
+ Another year of trying to close the courthouse doors to
+innocent victims of preventable violence of any kind. Another
+year of radically altering and undermining our system of
+States' rights, which so many on this Committee have given so
+much and so much energy to saying that they support. Another
+year of trying to confer sweeping immunity to a single
+industry, the gun industry, in this case. Here we go again.
+Here we go again.
+ I'd have to say, Mr. Chairman, that last year's debate on
+this bill didn't reveal to me any reason why individuals harmed
+by guns that were recklessly placed in the stream of commerce
+should not be allowed to seek a remedy from those responsible,
+including those whose negligent conduct--negligent conduct--
+resulted in dangerous weapons landing in the hands of
+criminals. Nor was I convinced that there exists a national
+crisis that requires Federal intervention in this matter.
+States are and have been perfectly capable, through both their
+courts and legislatures, of developing tort principles and
+addressing gun policy at a local level.
+ Finally, I didn't find anything in last year's testimony or
+any of the things that I have found out about this bill that
+would suggest to me why it would be necessary to single out for
+unprecedented protection the entire gun industry, even as the
+number of deaths and injuries from gun violence and accidental
+shootings has escalated. Under this bill, on one within the gun
+industry bears any responsibility, no duty of care for the
+misuse of dangerous weapons.
+ When the industry acts responsibly, there should be no
+liability. I agree with that wholeheartedly. But when elements
+within the industry act without regard to the safety of our
+citizens, those harmed by such indifference or recklessness
+should be afforded a remedy.
+ I don't know what happened to the concept of personal
+responsibility, corporate responsibility, our whole theory of
+negligence in this country. Our whole theory of tort law in
+this country is based on negligence, and I have no idea why one
+industry should be exempt from those theories that we have
+developed for so long. They are all about personal
+responsibility. That's what our whole negligence system is
+about.
+ If any of our witnesses can today address these very basic
+and fundamental concerns about this bill, I'm still looking for
+enlightenment about it. But I believe that unless and until
+these three core issues are adequately addressed and
+substantiated, the Federal court, the Federal Government, has
+no jurisdiction for barring State courts from providing
+appropriate relief to victims of negligent conduct.
+ We are off and running again. Here we go again, Mr.
+Chairman. I yield back.
+ Can I just add one thing, Mr. Chairman? I want to put in
+the record some information here that is just astonishing to
+me. This is from the Smith and Wesson SEC filing,\1\ and I'm
+quoting this. ``In the 9-month period ended January 31, 2005,
+we incurred $4,535 in defense costs net of amounts receivable
+from insurance carriers relative to product liability and
+municipal litigation. For the 9 months ended January 31, 2005,
+we spent $4,150,000 on advertising.'' Put that into this
+calculus. Thank you, Mr. Chairman.
+---------------------------------------------------------------------------
+ \1\ The information referred to was not available to include in
+this hearing.
+---------------------------------------------------------------------------
+ Mr. Cannon. Without objection, that'll be included in the
+record.
+ Would the gentleman yield to a question? How much did they
+spend on their insurance premiums, do you know? Does the filing
+reveal that?
+ Mr. Watt. I have no idea, but probably no more than any
+other inherently dangerous product maker would be spending on
+their insurance. There are some risks of business. You have
+insurance on your automobile, probably a lot more than most
+people sitting around because people think that you are more
+vulnerable, you drive more, you expose yourself to more risks,
+you're more valuable, you're more important, and I suspect your
+insurance premiums are higher than most of the people sitting
+in this audience.
+ Mr. Cannon. I drive very carefully, so I keep my premiums
+down. I don't think these guys control who sues them.
+ We'd like to welcome Adam Smith from Washington, Steve
+Chabot from Ohio, Mr. Van Hollen from Maryland, and Mr. Coble
+from North Carolina. Does anyone other than Mr. Smith want to
+make an opening statement? Oh, and we've got the gentleman, Mr.
+Franks, from Arizona. Would anyone like to make an opening
+statement of any sort?
+ Mr. Chabot. Mr. Chairman, if I could, just very briefly.
+ Mr. Cannon. Let me, if you don't mind, I'm going to ask Mr.
+Smith to go first and then we'll come back to you.
+ Mr. Chabot. Sure.
+ Mr. Cannon. Would anyone else like to make a--Mr. Coble?
+Okay.
+ Mr. Smith. It's more of a question just for the witnesses
+so that as they're testifying, they can hopefully address it,
+and we've sort of gotten this from the two opening statements.
+ The big question for me is exactly what liability is left.
+I mean, the basic notion that if you sell a gun in a perfectly
+legal way and basically have no negligence in how you go
+through that process, then you should not then be liable if
+someone misuses it is something that I support. I think it is
+different, frankly, than what went on with the tobacco industry
+when they sold a product and misled the public for a good many
+years about the dangers. There's no misleading about the
+dangers of a firearm. As Mr. Watt himself said, it's fairly
+apparent how dangerous it is, so the person who's buying it
+knows that.
+ But in the debate over this issue, I have heard so much
+conflicting information on what liability remains, you know,
+what negligence can be demonstrated by the person. Certainly,
+if they sell to someone who shouldn't have bought a firearm,
+someone who is disqualified through the law because they are a
+felon, mentally incompetent, or below the age of 18 or the
+normal categories, they should be liable.
+ But there's one specific case that arose not far from my
+district, the sniper case out here. The gun that was used in
+those crimes was actually purchased in my district, or
+actually, I should say, actually came from a store in my
+district. It is still unclear how that got to be in the
+person's possession because the gun shop has no records. They
+have records that they had the guns and then, oops, they're
+gone. They have no records of how it actually got to be in
+somebody else's hands or even out of their store, for that
+matter.
+ To my mind, that is at least enough of a case of negligence
+that you go to court. I mean, you'd have to hear from the jury
+and so forth. I do not want to exclude that company from
+liability when they had some number of guns that just went
+unaccountably missing. That is negligence, to my mind,
+depending on the facts. It's at least a case for the jury,
+let's put it that way.
+ And if I could just get some kind of correct answer--I
+suspect that I'll get about five different contradictory
+answers--as to whether or not this bill would exempt people
+like that from liability when there was some clear evidence of
+negligence, and you can imagine a variety of other different
+negligent circumstances where it at least should be a question
+for the jury whether or not this negligence rose to the level
+of liability.
+ I certainly agree with the Chairman's sentiment that if you
+sell a legal product without negligence, even if it's
+dangerous, it's like an automobile is a good analogy, if you
+use it poorly and get in the accident, it shouldn't be the
+liability of the manufacturer unless there was some negligence.
+But I'm just trying to figure out what the limits are. So if
+you could address that issue as you testify, that would be very
+helpful to me.
+ Mr. Cannon. Thank you. The gentleman yields back.
+ Mr. Chabot, you are recognized for 5 minutes.
+ Mr. Chabot. Thank you, Mr. Chairman. I won't take the 5
+minutes. I'll be very brief. I just want to first of all
+commend you for holding this important hearing today and to
+reiterate my support for this really much-needed piece of
+liability reform legislation. I want to commend Mr. Stearns for
+offering it.
+ It's really critical for a number of reasons. It'll protect
+really people's Second Amendment rights. You know, we give lip
+service to it all the time, but this is one thing, I think,
+when we can really stand up for the citizens' Second Amendment
+rights, and the firearms industry, I think, has been targeted.
+And even if you ultimately prevail in the lawsuit, the
+resources that you have to use up and the time, the attorneys'
+fees, court costs, all the rest, can be quite sigsnificant and
+it can drag on really interminably.
+ And we also have--I think it's an example of some of the
+activist courts, too, in these cases. We have a judiciary which
+too often is rewriting the law and legislating from the bench,
+and I think this is an example where the activist courts have
+gotten too involved. As I mentioned before, even if you win as
+a defendant in one of these cases, you can lose.
+ And you'll have a city which is essentially using what they
+might consider to be unlimited resources, but when you consider
+many of the cities right now which are in real financial
+straits, they'll get involved in one of these lawsuits and it
+just drags on and on and on, so you're utilizing the resources
+which could much better be used to fill potholes and do other
+things which the cities really ought to be about. Instead,
+they're suing an industry which I think has really been under
+assault for a number of years now.
+ If citizens are going to be able to actually exercise their
+Second Amendment rights, they're going to have to be able to
+purchase these weapons and purchase firearms. When you have the
+assault that's been on a number of these companies for some
+time now, it really does infringe upon those Second Amendment
+rights.
+ So I want to commend you for having this hearing, and
+again, strongly urge my colleagues to support this much-needed
+legislation. I yield back.
+ Mr. Cannon. Thank you. Mr. Van Hollen, did you want to take
+5 minutes?
+ Mr. Van Hollen. Thank you.
+ Mr. Cannon. The gentleman is recognized for 5 minutes.
+ Mr. Van Hollen. I thank you, Mr. Chairman, and I won't take
+the whole 5 minutes. I will be brief.
+ It's a coincidence that the two new Members, at least on
+the Democratic side of the Committee here, are two Members who
+were involved, by coincidence, in the sniper shooting, because
+while the guns that were used in the sniper shooting may have
+been sold in Mr. Smith's district, they were used and with the
+result that many people were killed in the district I
+represent.
+ I have attended over the last couple of years a number of
+memorial services for the victims. A number of memorials have
+been placed in public places in my Congressional district and
+other places around the Washington area in memory of the
+victims of those shootings.
+ And I really have many of the same issues Mr. Smith asked
+about, although as I read the legislation, it's pretty clear
+that that case would not have been able to go forward, a case
+that was settled, a case where there was some payment of
+damages, I believe in the range of $2 million by the owners of
+the store and some monies paid by the manufacturer.
+ If you look back in the record of this debate in the
+Senate, there was an effort in the Senate after the House
+passed the bill to attach an amendment that would have made it
+clear that under the circumstances of the sales of the guns
+used in the Sniper shooting that it could have gone forward. I
+think that those of us who have looked at the facts of that
+case believe that it was a situation where there was clearly
+reckless negligence, negligence on behalf of the gun store.
+ And I, in reading this and having read the legal opinions
+of a number of law firms in town, I think it's quite clear that
+if this legislation passes in its current form, those victims
+would not have an opportunity to obtain justice and redress
+through the courts in this country and they would have had the
+courthouse door shut on them.
+ It's ironic that this piece of legislation was actually
+being debated by the House of Representatives about the time
+the sniper shootings occurred and it was withdrawn at that time
+because people understood that the public wouldn't stand for a
+Congress passing a piece of legislation that took away the
+rights of the victims. And here we are a couple of years later
+when people think memories have faded and there is again,
+regrettably, in my view, a piece of legislation which I think
+is quite clear would shut the doors of justice to those
+victims.
+ Thank you, Mr. Chairman.
+ Mr. Cannon. Thank you, and Mr. Coble, did you want to--the
+gentleman is recognized for 5 minutes.
+ Mr. Coble. Mr. Chairman, I will not take the 5 minutes. I
+thank you for recognizing me. But not unlike my friend from
+North Carolina, the Ranking Member, I want to apologize for my
+arrival and to furthermore, Mr. Chairman, apologize for my
+abrupt departure because I have an aviation hearing going on as
+we speak here.
+ I just want to state for the record, Mr. Chairman, that if
+a manufacturer--strike that. It is my belief that if a
+manufacturer develops a lawful product and lawfully markets it
+absence negligence, I think that manufacturer should be held
+harmless. If, on the other hand, there is negligent conduct
+involved, then I think that manufacturer should have to answer
+to it.
+ I don't mean to overly simplify it, but that's my position,
+Mr. Chairman, and I yield back.
+ Mr. Cannon. I thank the gentleman for yielding back. This
+may be a moment in history. We've had four people speak and not
+go over the time. In fact, all of them were significantly under
+the time.
+ Mr. Watt. Except the Chairman, of course. [Laughter.]
+ Mr. Cannon. Oh, I didn't keep track. [Laughter.]
+ The way I read the clock, it was okay. [Laughter.]
+ But I only said four. I think you were under, too, which
+would make it five.
+ Mr. Watt. I was under.
+ Mr. Coble. Mr. Chairman, would you yield to me just a
+second?
+ Mr. Cannon. I would certainly yield.
+ Mr. Coble. I think you and the Ranking Member probably have
+wider latitude than the rest of us on your opening statements.
+ Mr. Cannon. I thank the gentleman.
+ The Committee is pleased to have the Ranking Member of the
+full Committee, Mr. Conyers of Michigan, with us. Did you want
+to make a statement, Mr. Conyers?
+ Mr. Conyers. If I could, and I thank you very much----
+ Mr. Cannon. The gentleman is recognized for 5 minutes.
+ Mr. Conyers. --Mr. Chairman. Last week, the GAO issued a
+report which concluded that the FBI could better manage its gun
+buying records when matching them against lists of suspected
+terrorists. In particular, the GAO determined that information
+sharing procedures needed to be considerably improved in order
+to help Federal counterterrorism officials better track
+suspected terrorists who attempt to purchase firearms.
+ Nor are we here to discuss the two assault weapons used in
+unrelated multiple shootings in February. One shooting involved
+a Tyler, Texas person and the other took place in Los Angeles,
+with assault rifles in both cases. The fact that both shootings
+occurred on the same day made the two stories even more
+newsworthy, but obviously, not deserving, unfortunately, of a
+Congressional response.
+ Neither have we seen fit to respond to the requests from
+law enforcement officials to take appropriate Congressional
+action in response to recent introduction of the Five-Seven
+handgun, dubbed by some as the ``copkiller'' gun because it is
+easily concealable and can penetrate bulletproof vests of law
+enforcement officers. The Director of the International
+Brotherhood of Police Officers described this new weapon as an
+assault weapon that fits your pocket.
+ And so in the minds of any, any one of the aforementioned
+public policy problems should take precedent over the one
+before us today because they pose grave risk to human life. And
+so the bill that purports to protect our court system, even
+though it's not--if or when a frivolous lawsuit is brought
+before----
+ Well, I'll return my time, Mr. Chairman. But I think this
+is an incredibly important issue that is before your
+Subcommittee and I thank you for the opportunity to discuss it
+with you.
+ Mr. Cannon. I thank the gentleman, and I'm now astounded
+that we've had, with possibly the exception of me, although I
+didn't look at the clock, everyone spoke for less than 5
+minutes and that will allow us to get on--we are joined by the
+gentleman from Texas, Mr. Gohmert. Did you want to speak, Mr.
+Gohmert?
+ Mr. Gohmert. If I might.
+ Mr. Cannon. The gentleman is recognized for 5 minutes----
+ Mr. Gohmert. Thank you.
+ Mr. Cannon. --recognizing the trend that we have in place,
+Mr. Gohmert.
+ Mr. Gohmert. Thank you, Mr. Chairman. I very much
+appreciate that and I appreciate the individuals here and their
+testimony.
+ It was mentioned about the shooting in Tyler, Texas. That
+happened right outside the courthouse where I worked for a
+decade and knew and loved so many of the people there. The
+weapon used by the individual regarding a domestic situation
+was used outside the courthouse and it was a semi-automatic
+weapon. It was not an automatic weapon. It should be noted that
+when we toss around the term ``assault weapon'' that any weapon
+could be an assault weapon, just like any knife, whether steak
+knife or 11-inch butcher knife, could be an assault knife.
+Every weapon, no matter what it is, could be an assault weapon.
+ Congress did respond, at least this one did, immediately,
+within a day or two went to the floor of the House and gave a
+very moving, heartfelt, at least, tribute to Mark Wilson, who
+was the man that had the concealed carry permit who immediately
+put himself in danger by drawing a weapon he was lawfully
+allowed to have and firing at the individual, the murderer, and
+at least drawing his attention away from the others, and, I
+believe, saving the life of many other people there.
+ And because Texas has a concealed carry permit and the
+actions of Mark Wilson and the prompt response by law
+enforcement after Mark, we did not have another Luby's like we
+had years before where nobody had a weapon when a crazy nut
+came in and started shooting wildly. Here, we had somebody and
+we had a citizenry and a law enforcement that were armed. They
+protected the public to minimize the damage that occurred
+there, and I thank God for Mark Wilson and law enforcement and
+for the laws that made that possible. Thank you.
+ Mr. Cannon. That was only about two-and-a-half minutes, Mr.
+Gohmert. I am pleased. There has got to be some kind of record
+for this. I mean, this is an amazing thing. I would remind the
+Committee that, generally speaking, we want to get to witnesses
+more early, and so as we read our statements, we work with, the
+Ranking Member and me, to get issues in and we are going to try
+in future hearings to avoid these kinds of--or opening
+statements.
+ But, of course, as the panel and others will recognize,
+these are very important issues. They are held very dearly by
+everyone here and so we recognize that it may be a slightly
+different case.
+ We now turn to our panel of witnesses. Our first witness is
+Rodd Walton. Mr. Walton is the Secretary and General Counsel of
+Sigarms, Inc. He's also a major in the United States Army
+Reserve, Judge Advocate General Corps. Mr. Walton joined the
+military right out of high school in 1984 and he has been in
+the military for 21 years--hard to believe at your age. He
+recently came off a one-and-a-half-year tour of duty in the war
+on terror. In the American Bar Association, Mr. Walton serves
+as Chair of the Business and Commercial Law Committee--good. In
+the National Bar Association, Mr. Walton serves as Secretary of
+the Small Business Law Section.
+ Our second witness is Dennis Henigan, the Legal Director of
+the Brady Center to Prevent Gun Violence in Washington, D.C.,
+and the Director of its Legal Action Project. The Legal Action
+Project is a national public interest law program which
+provides pro bono legal representation to victims of gun
+violence and lawsuits against the gun industry. In addition to
+representing individual victims of violence, the Legal Action
+Project also has represented over two dozen municipalities in
+lawsuits seeking to recover the public costs of gun violence.
+ Our third witness is Bradley T. Beckman of Beckman and
+Associates in Philadelphia. For roughly a dozen years, Mr.
+Beckman has been National Counsel for North American Arms in
+lawsuits brought by various municipalities. North American Arms
+is a Utah-based manufacturer of high-quality personal
+protection firearms that has been in business for over 30
+years. Welcome from Utah.
+ Our fourth and final witness is Lawrence G. Keane. Mr.
+Keane is the Senior Vice President and General Counsel of the
+National Shooting Sports Foundation, Inc., the firearm
+industry's trade association. He's responsible for all of
+NSSF's legal, Government relations, and risk management
+functions. Mr. Keane also served on the Board of Directors of
+the Firearms Safety Education Foundation, Inc., a nonprofit
+501(c)(3) charitable organization dedicated to educating the
+public about firearms safety issues.
+ Without objection, all Members will have 5 days within
+which to submit additional material for the record.
+ Now, it is the practice of the Committee to swear in all
+witnesses appearing before it. If you would please stand and
+raise your right hand.
+ Do you swear that the testimony that you are about to give,
+that you will tell the truth, the whole truth, and nothing but
+the truth, so help you, God?
+ Mr. Walton. I do.
+ Mr. Henigan. I do.
+ Mr. Beckman. I do.
+ Mr. Keane. I do.
+ Mr. Cannon. The record will note that the witnesses all
+answered in the affirmative. Please be seated.
+ Now, Mr. Walton, we would like to hear from you for 5
+minutes. I don't want to interrupt. We don't want to stop
+anybody's train of thought, but I'll tap my pencil on the
+podium here when you get at 5 minutes just so you're aware.
+There's a little timer in front of you that it's green for 4
+minutes, turns yellow for 1 minute, and then turns red at the
+end of the 5 minutes. You don't have to stop at that red light,
+but just be aware that we'd like to wind down, and then we'll
+have plenty of time for questions. Thank you.
+ Mr. Walton?
+
+ TESTIMONY OF RODD C. WALTON, SECRETARY AND
+ GENERAL COUNSEL, SIGARMS, INC.
+
+ Mr. Walton. Mr. Chair, thank you for having me here, and
+keeping with your time limit and the spirit of the meeting and
+being timely, I'll do my best.
+ Chairman Cannon, Members of the Committee, my name is Rodd
+Walton. I'm Secretary and General Counsel of Sigarms and its
+affiliates and subsidiaries in the United States. I am here
+today to ask you to support H.R. 800.
+ Since 1853, Sigarms and related companies, together with
+our predecessors, have been manufacturing small arms for
+military, law enforcement, and commercial use. Switzerland's
+Federal Ministry of Defense challenged a Swiss wagon factory to
+make a rifle for the Swiss army. Accepting the challenge, and
+after receiving the contract, the wagon company changed its
+name to Swiss Industrial Company--I'm not going to try to speak
+it in German, but it's currently world known as Sigarms. SIG
+brought our firearms industry to Virginia in 1985 and then
+moved to New Hampshire, where we call home today.
+ The foundation and thrust of Sigarms' business has been and
+will continue to be support of military and law enforcement
+customers worldwide. The list of Sigarms' customers in the
+United States reads like a Who's Who of law enforcement.
+Sigarms pistols are carried by the Department of Homeland
+Security, the U.S. Coast Guard, the Federal Air Marshals, the
+U.S. Secret Service, State police agencies from Delaware,
+Massachusetts, Michigan, New Jersey, Virginia, as well as the
+Texas Department of Safety and the Texas Rangers, just to name
+a few. And, SIG Sauer pistols are carried by many in combat,
+most notably the U.S. Navy Seals. Today, about 65 percent of
+the output of the New Hampshire-based manufacturing facility is
+devoted to supplying firearms and training to military and law
+enforcement.
+ Since 1988--excuse me, '98, we at Sigarms have been
+defending ourselves against a multitude of lawsuits brought by
+Government entities and organizations and individuals seeking
+to blame the firearms industry, including SIG, for criminal and
+wrongful misuse of firearms in the United States. To blame
+Sigarms for the criminal misuse of firearms that are lawfully
+manufactured and sold is unjust. It is also threatening to our
+very existence. We have been fighting for our very survival
+against these lawsuits, diverting time, money, and other of our
+limited resources to defend ourselves.
+ As I walk through the plant, employees stop to ask me,
+``How's the war going?'' The war that the employees are asking
+about is not the Iraqi war. It's the war we are fighting
+against plaintiffs filing junk and frivolous lawsuits against
+the firearms industry, spurred on by plaintiffs' trial
+attorneys.
+ Sigarms and many others in the industry have been fighting
+for 10 years now, beginning with Hamilton v. Accu-Tek, in which
+the plaintiffs claimed that we manufacturers negligently
+distributed firearms. While the jury found the case--some of
+the manufacturers to be liable, the verdicts were properly
+reversed on appeal. The same plaintiffs' lawyers decided to
+bring a similar case before the same trial judge. They brought
+the NAACP case based on similar theories that had already been
+rejected by the U.S. Court of Appeals. While we are resolved
+not to wear down, there is a cost to this war.
+ Beyond these lawsuits draining our already fragile national
+economy and littering our already overburdened court system,
+this war is hindering companies like Sigarms from engaging in
+legitimate business, making lawful products. The existence of
+these lawsuits thwarts our ability to raise new capital, borrow
+money, establish credit, obtain insurance, attract new
+employees, and retain valued employees in the same manner that
+companies of other industries are able to do without these
+attacks.
+ These lawsuits are dangerous, and not only to us as
+manufacturers of lawful products in other industries. Where
+will this end? Should General Motors be liable for an
+aggressive driver who crashes into another car? If the theory
+of these cases are widely applied, it could result in the
+bankruptcy of countless companies and the displacement of
+innumerable amount of American workers.
+ I come here today to ask you to support H.R. 800. This bill
+would protect legitimate businesses, such as Sigarms, that
+provide hundreds of thousands of jobs for our citizens--
+assemblers, polishers, tool and die makers, cafeteria workers,
+and people who fill our snack vending machines.
+ If enacted into law, this Act would preempt State and local
+government entities and other parties from bringing aggregate
+lawsuits against the firearms industry as a way to circumvent
+our legislatures. It would promote interstate and foreign
+commerce of small arms. A majority of the States--in fact, over
+30--have passed legislation of some type that insulate the
+firearms industry from these types of lawsuits. However, we
+need and are seeking passage of Federal law that would afford
+protection to the industry on a national level.
+ I think my time is about up, so I will yield to the chair.
+Thank you, sir.
+ Mr. Cannon. Thank you very much.
+ [The prepared statement of Mr. Walton follows:]
+
+ Prepared Statement of Rodd C. Walton
+
+ Chairman Cannon, Members of the Committee, my name is Rodd Walton.
+I am Secretary and General Counsel of SIGARMS, Inc. and its affiliates
+and subsidiaries in the United States. I am here today to ask you to
+support H.R. 800.
+ Since 1853, SIGARMS related companies, together with our
+predecessors, have been manufacturing small arms for military, law
+enforcement and commercial use. Switzerland's Federal Ministry of
+Defense challenged a Swiss wagon factory to make a rifle for the Swiss
+Army. Accepting the challenge and after receiving the contract the
+wagon company changed its name to the Swiss Industrial Company--
+Schweizerische Industrie-Gesellschaft known worldwide as SIG. SIG
+brought our firearms business to Virginia in 1985 and then moved it to
+New Hampshire, where we call our home today.
+ The foundation and thrust of SIGARMS business has been and will
+continue to be support military and law enforcement customers
+worldwide. The list of SIGARMS customers in the United States reads
+like a Who's Who of law enforcement. SIG SAUER pistols are carried by
+the Department of Homeland Security, The U.S. Coast Guard, The Federal
+Air Marshalls, The U.S. Secret Service, state police agencies from
+Delaware, Massachusetts, Michigan, New Jersey, Virginia as well as the
+Texas Department of Public Safety and the Texas Rangers just to name a
+few. And SIG SAUER pistols are carried by many in combat and most
+notably by the U.S. Navy SEALs.
+ Today, approximately 65% of the output at the New Hampshire-based
+manufacturing facility is devoted to supplying firearms and training to
+military and law enforcement.
+ Since 1998, we at SIGARMS have been defending ourselves against a
+multitude of lawsuits brought by government entities, organizations and
+individuals seeking to blame the firearms industry, including SIGARMS,
+for the criminal and wrongful misuse of firearms in the United States.
+To blame SIGARMS for the criminal misuse of firearms that are lawfully
+manufactured and sold is unjust. It also is threatening to our very
+existence. We have been fighting for our very survival against these
+lawsuits, diverting time, money and other of our limited resources to
+defend ourselves.
+ As I walk through our plant, employees stop to ask me how the war
+is going. The war that our employees are asking about is not the Iraqi
+War; it is the war we are fighting against plaintiffs filing junk and
+frivolous lawsuits against the firearms industry, spurred on by
+plaintiffs' trial lawyers.
+ SIGARMS and many others in the industry have been fighting for ten
+years now, beginning with the Hamilton v. Accu-Tek case, in which the
+plaintiffs claimed that we manufacturers negligently distributed our
+firearms. While the jury in that case found some of the manufacturers
+liable, the verdicts were properly reversed on appeal. The same
+plaintiff's lawyer decided to bring a similar case before that same
+trial judge. They brought the NAACP v. A.A. Arms, Inc. case based on
+similar theories that had already been rejected by the U.S. Court of
+Appeals. While we are resolved not to wear down, there is a cost to
+this war.
+ Beyond these lawsuits draining our already fragile national economy
+and littering our already over-burdened court system, this war is
+hindering companies like SIGARMS from engaging in a legitimate
+business, making a lawful product. The existence of these lawsuits
+thwarts our ability to raise new capital, borrow money, establish
+credit, obtain insurance, attract new employees, and retain valued
+employees in the same manner that companies in other industries are
+able to do without these attacks against their industry.
+ These lawsuits are dangerous not only to us but also to
+manufacturers of lawful products in other industries. Where will it
+end? Should General Motors be liable for an aggressive driver who
+crashes into another car? If the theory of these cases is widely
+applied, it could result in the bankruptcies of countless companies and
+the displacement of innumerable amount of American workers.
+ I come here today to ask you to support H.R. 800. This Bill would
+protect legitimate businesses, such as SIGARMS, that provide hundreds
+of thousands of jobs for our citizens, assemblers, polishers, tool and
+die makers, cafeteria workers and the people who fill our snack vending
+machines.
+ If enacted into law, this Act would preempt state and local
+government entities and other parties from bringing aggregate liability
+lawsuits against the firearms industry as a way to circumvent our
+legislatures. It also would promote interstate and foreign commerce of
+small arms. A majority of the states--in fact, over 30 states--have
+passed legislation of some type that insulate the firearms industry
+from these types of suits. However, we need and are seeking passage of
+Federal law that would afford protection to the industry on a national
+level.
+ Let me emphasize that this legislation would not provide the
+sweeping immunity that many of its opponents suggest. This Bill would
+not protect gun manufacturers from liability claims. Instead, it would
+stop lawsuits against our industry that are based on the criminal
+misuse of lawfully distributed products and premised on theories such
+as public nuisance and market share liability.
+ If passed, this Bill would help to set a much needed precedent that
+frivolous and junk suits like these should be stopped. If passed, it
+would prevent the usurpation of power by the judicial branch from the
+legislative branch. For it is the legislature that makes laws on how we
+should manufacture, design, and sell firearms, not the courts. If not
+stopped, these lawsuits clearly will threaten other legitimate and
+vital industries in America.
+ This Bill if enacted would restore the rule of law and protect
+manufacturers and sellers in the firearms and ammunition industry who
+act legally from being harassed by frivolous and junk lawsuits.
+However, the Bill ensures that if a seller provides a firearm and the
+seller knows or should have known that the firearm would be used
+negligently, that seller would be liable.
+ We are dutifully helping to defend our country when attacked and in
+times of war. I ask that each of you help us in our time of war so that
+we can focus on making the best firearms available for our men and
+women in uniform and law enforcement.
+ In conclusion, it makes no difference that SIGARMS or other firearm
+manufacturers make high quality firearms that enjoy excellent records
+of safety. It makes no difference that we and our industry are
+committed to continuing our efforts, individually and together with
+others, to increase awareness of the issues related to the safe
+handling and storage of firearms and the criminal acquisition of
+firearms. In makes no difference that the firearms industry is one of
+the most patriotic and staunchly pro-law and order industries in the
+corporate landscape. These frivolous and junk lawsuits are being
+brought to exert undue pressure on our industry to settle or cave under
+the massive weight of litigation. Without this Federal legislation, the
+survival of SIGARMS, our firearms and ammunition industries, and all of
+the jobs, taxes, and commerce that we contribute to the U.S. economy
+are threatened.
+
+ Mr. Cannon. Mr. Henigan, you are recognized for 5 minutes.
+
+TESTIMONY OF DENNIS A. HENIGAN, DIRECTOR, LEGAL ACTION PROJECT,
+ BRADY CENTER TO PREVENT GUN VIOLENCE
+
+ Mr. Henigan. Thank you, Mr. Chairman, and thank you to the
+entire Subcommittee for this opportunity to appear today.
+ Let me state my position on this bill in the must
+unequivocal terms. This bill is nothing but a special interest
+giveaway to the gun lobby and a shameful attack on the legal
+rights of gun violence victims.
+ As an attorney at the Brady Center, I have had the honor to
+represent on a pro bono basis gun violence victims whose rights
+would be trampled by this legislation, and I have a difficult
+time explaining to those clients why we are here today. As
+Ranking Member Conyers noted, just recently we have heard that
+suspected terrorists repeatedly have been able to buy guns over
+the counter in our country. The Department of Homeland Security
+recently issued an alert about that Belgian gun manufacturer
+that is selling a handgun in this country that shoots bullets
+that can penetrate police body armor.
+ And what is the response of the U.S. Congress to these
+recent threats to our national safety and security? Is it to
+move quickly to prevent terrorists from buying guns over the
+counter? Is it to ban copkiller handguns? No. It is to hold
+hearings on a bill to give special legal protection to the most
+reckless gun sellers in America.
+ Mr. Chairman, this Congressional response defies rational
+explanation. I regret to say the only explanation is the
+overarching power of the gun lobby.
+ Now, the proponents of this bill say it affects only
+frivolous lawsuits brought to bankrupt the gun industry. This
+assertion is insulting to the victims who have sought to assert
+their legal rights against this industry and it also grossly
+misrepresents what this bill does.
+ Consider first the lawsuit brought by Brady Center
+attorneys for New Jersey Police Officers David Lemongello and
+Ken McGuire. These two officers were seriously wounded in a
+shoot-out with an armed robbery suspect, and the Ruger pistol
+used by the shooter was sold by a West Virginia pawn shop
+called Will's Jewelry and Loan. It was one of 12 handguns sold
+by Will's in a single transaction 6 months before the shooting
+to a gun trafficking team. A woman named Tammi Lea Songer acted
+as a straw buyer for a gun trafficker, James Gray. Gray pointed
+out the guns he wanted. Songer paid the clerk $4,000 in cash.
+It was perfectly obvious those guns were headed to the illegal
+market.
+ So the officers brought a civil damages suit against Will's
+and a West Virginia judge determined that the suit stated
+legally valid claims. If this legislation had passed last year,
+the judge's decision would have been nullified and the police
+officers' suit would have been dismissed. But fortunately, the
+bill failed. The suit went forward. And in June of last year,
+Will's settled the suit with a payment of $1 million in damages
+to those two brave police officers. And as a result of this
+suit, that gun shop no longer engages in large-volume sales of
+handguns.
+ So because this bill failed last Congress, two brave police
+officers received a measure of justice, the pawn shop was held
+accountable for this reckless sale, and the pawn shop now
+operates more responsibly than it did before, and I might add,
+no one went bankrupt.
+ But consider also the case brought by Brady Center lawyers
+for the victims of the D.C. area sniper shootings against
+Bull's Eye Shooter Supply, the gun shop in Tacoma, Washington,
+that Mr. Smith referred to, where the gun that was used in that
+shooting mysteriously disappeared from that gun shop. And it
+turned out that in the previous 3 years, some 238 other guns
+had mysteriously walked away from that gun shop.
+ So eight D.C. sniper victims and their victims brought a
+lawsuit with our help seeking damages against Bull's Eye, and
+we also sued Bushmaster, the manufacturer of the assault rifle,
+because it sold military-style assault rifles to the general
+public while doing absolutely nothing to ensure that the
+retailers it chose to do business with were responsible
+corporate citizens.
+ Well, in June of 2003, a Washington State trial judge ruled
+the victims' claims were legally valid against both of those
+defendants, but if this immunity bill had passed, Mr. Chairman,
+it would have required dismissal of that lawsuit, even though a
+Washington State court had already held it consistent with
+accepted principles of law. And in the last Congress, we had
+letters from former White House Counsel Lloyd Cutler as well as
+noted attorney David Boies analyzing exactly the question Mr.
+Smith raised and concluding that, in fact, this would bar that
+lawsuit.
+ Mr. Smith. Mr. Chairman, I'm sorry to break the flow here,
+but could I ask a question on that?
+ Mr. Chabot. [Presiding.] Yes, if you will make it quick.
+ Mr. Smith. In reading the bill, it says that the immunity
+shall apply but shall not include an action brought against a
+seller for negligent entrustment or negligence per se. I guess
+given that exception, you're telling me you couldn't make a
+case for negligence in that situation?
+ Mr. Henigan. That's right, Mr. Smith. Neither of those
+exceptions would have applied, and let me explain why. First of
+all, negligence per se would have required a showing that the
+gun shop violated a law leading to the shooting that occurred.
+That's what negligence per se requires, as opposed to ordinary
+negligence, Mr. Smith, which simply requires a violation of the
+common law duty of ordinary care.
+ In every State that adopts negligence per se, you have to
+show a violation of a law and then you have to show the causal
+link between the shooting and the violation. Here, what we had
+was a situation in which----
+ Mr. Smith. You could go on, but that answers the question.
+ Mr. Chabot. Okay, and if you wouldn't mind wrapping up your
+testimony, Mr. Henigan.
+ Mr. Henigan. Okay.
+ Mr. Chabot. Your 5 minutes are up.
+ Mr. Henigan. I'd be happy to do that. These cases, Mr.
+Chairman, show how the proponents of this bill have
+misrepresented what the bill does, because these are two cases
+that were not frivolous. They were two cases not about trying
+to hold gun sellers responsible simply because a criminal uses
+the gun to shoot somebody, but to hold them responsible for
+their own conduct.
+ I would suggest, Mr. Chairman, that if we are going to be
+in the business of immunizing from civil liability the most
+reckless gun sellers among us, that is not only going to
+deprive gun violence of their legal rights, it's going to make
+us all more unsafe. It's going to mean more guns on the
+streets, and for those reasons, we urge that this bill be
+defeated. Thank you.
+ Mr. Chabot. Thank you, Mr. Henigan.
+ [The prepared statement of Mr. Henigan follows:]
+
+ Prepared Statement of Dennis A. Henigan
+
+ Chairman Cannon, Ranking Member Watt, Members of the Subcommittee,
+I appreciate this opportunity to appear before you today. On behalf of
+Jim and Sarah Brady, and their organizations, let me state my position
+on H.R. 800 in the most direct and unequivocal terms: this bill is
+nothing but a special interest giveaway to the gun lobby and a shameful
+attack on the legal rights of innocent victims of gun violence.
+ As Director of the Legal Action Project at the Brady Center to
+Prevent Gun Violence,\1\ I have the honor to represent, on a pro bono
+basis, innocent victims of gun violence whose rights would be trampled
+by this legislation. I have a difficult time explaining to these
+clients, who have personally faced the horror of gun violence, why the
+response of the United States Congress to their personal tragedies, and
+to the continuing national tragedy of gun deaths and injuries, is to
+give special legal protection to the most reckless members of the gun
+industry.
+---------------------------------------------------------------------------
+ \1\ The Brady Center, and its affiliate, the Brady Campaign to
+Prevent Gun Violence united with the Million Mom March, are the largest
+organizations dedicated to creating an America free from gun violence.
+---------------------------------------------------------------------------
+ Just last week, the GAO reported that suspected terrorists, who are
+not permitted to board airplanes or cruise ships, repeatedly have been
+allowed to purchase guns over-the-counter.
+ The Department of Homeland Security recently issued an alert to all
+its law enforcement personnel about a Belgian gun maker selling a
+handgun in America that shoots bullets that penetrate police body
+armor.
+ Another gun maker is selling .50 caliber sniper rifles with such
+extraordinary range and power that they can bring down airplanes.
+ And gun deaths in America, after a seven-year decline, have started
+to rise again and are now over 30,000 a year. In the last two weeks,
+our Nation has learned, once again, that no one is truly safe from gun
+violence: a judge's family slain in Chicago, a judge and two others
+murdered in an Atlanta courtroom and, on Saturday, seven worshippers
+shot and killed while attending church services in Milwaukee.
+ What is the response of the United States Congress to these clear
+and present threats to our national safety and security? Is it to move
+quickly to strengthen the Brady background check system to stop
+terrorist suspects from buying guns? Is it to ban cop-killer guns and
+terrorist sniper rifles? No. It is to hold hearings on a bill that
+would protect from legal accountability the most reckless gun sellers
+in America.
+ Mr. Chairman, this Congressional response is beyond rational
+explanation. I suggest the only explanation is the power of the gun
+lobby.
+
+ GUN INDUSTRY IMMUNITY LEGISLATION IS A SHAMEFUL ATTACK ON THE LEGAL
+ RIGHTS OF GUN VIOLENCE VICTIMS
+
+ The proponents of this legislation claim it would block only
+``frivolous'' lawsuits against gun sellers brought only to bankrupt the
+gun industry. Not only is this assertion a gross misrepresentation of
+the bill, it also is an insult to gun violence victims who have sought
+justice in the courts - justice that would be denied if this bill
+became law.
+ This legislation would provide legal immunity in many cases to
+grossly irresponsible gun dealers who supply the criminal gun market,
+as well as to manufacturers of defectively designed firearms. It would
+throw out of court innocent victims of gun violence, even where courts
+have found their cases justified by general and established principles
+of law. Never before has a class of persons harmed by the dangerous
+conduct of others been so wholly deprived of the right to legal
+recourse. As Senator Mike DeWine (R-Ohio) stated so eloquently in
+opposing this legislation of the Floor of the United States Senate a
+year ago: ``I oppose this bill because...it singles out one particular
+group of victims and treats them differently than all other victims in
+this country...It denies them their access to court.''
+ When this bill was debated in the last Congress, two lawsuits, then
+pending in the courts, were at the center of the debate. Lawyers at the
+Brady Center represented the victims in both cases. Had this
+legislation been passed into law last year, these lawsuits would have
+been blocked.
+
+Gun Industry Immunity Legislation Would Have Deprived Two New Jersey
+ Police Officers of their Legal Rights Against a Reckless West
+ Virginia Pawnshop
+ The first suit had been filed by two brave New Jersey police
+officers, David Lemongello and Ken McGuire. Almost two years ago,
+Officer Lemongello testified before this Subcommittee and told their
+story. In January of 2001, Dave Lemongello was on a stakeout of a gas
+station in Orange, New Jersey that had been the target of several armed
+robberies. He spotted an individual walking near the station who
+matched the description of a suspect in the robberies. When the officer
+approached, the individual, career criminal Shuntez Everett, opened
+fire with a Ruger pistol. Lemongello was hit three times, fell to the
+ground, and radioed for help. Officer McGuire responded, chased Everett
+into a nearby backyard, and the two exchanged fire. McGuire also was
+seriously wounded, but was able to return fire. Everett died from his
+wounds. The shootings ended the police careers of the two officers.
+ How was a convicted felon like Shuntez Everett able to obtain a
+handgun? It turned out that the gun used in the shooting was one of
+twelve handguns purchased from a West Virginia pawnshop six months
+before by a gun trafficking team. Tammi Lea Songer, acting as a straw
+purchaser for gun trafficker James Gray, paid $4,000 in cash for the
+guns, after Gray pointed out which guns he wanted. The pawnshop, Will
+Jewelry and Loan in Charleston, West Virginia, completed the sale, even
+though it was obvious that the handguns were headed directly into the
+illegal market. Indeed, the sale was so suspicious that Will reported
+it to ATF the next day, long after the shop had pocketed the profits
+and the guns were headed to New Jersey. Ironically, another one of the
+twelve guns was taken by Ken McGuire from a criminal suspect months
+before the gas station shooting. Because of the recklessness of a West
+Virginia gun dealer, Orange, New Jersey became a more dangerous place
+and the careers of two police officers were ended.
+ We represented Officers McGuire and Lemongello in a civil damages
+lawsuit against Will's pawnshop. The suit charged the pawnshop with
+negligence, and contributing to a public nuisance, in the sale of guns,
+creating a foreseeable risk that the guns would be used in criminal
+activity. In March of 2003, Judge Irene Berger of the Kanawha County
+Circuit Court denied Will's motion to dismiss our case, finding that
+the officers had stated a legally valid claim under general principles
+of West Virginia law. If the last Congress had enacted the predecessor
+of H.R. 800, Judge Berger's ruling would have been superceded and
+Officers McGuire and Lemongello would have been denied their day in
+court.
+ Because gun industry immunity legislation was defeated in the
+Senate a year ago, the case against Will's pawnshop went forward. In
+June of last year, Will's settled the case by paying $1 million in
+damages to the two officers. As a result of the suit, the pawnshop
+changed its policies and now no longer engages in large-volume gun
+sales. Two other gun dealers in the Charleston area have adopted
+similar policies.
+ I ask the Subcommittee to consider the outcome of this lawsuit. For
+these two brave police officers, justice was done. Will's pawnshop was
+properly held accountable for its reckless sale to a gun trafficking
+team and it now operates more responsibly. And no one declared
+bankruptcy. This outcome was possible only because this special
+interest immunity legislation did not become law.
+
+Gun Industry Immunity Legislation Would Have Deprived the DC-area
+ Sniper Victims of Their Legal Rights Against a Reckless
+ Washington State Gun Dealer and the Assault Weapon Manufacturer
+ that Supplied It
+ A second lawsuit that would have been blocked by this legislation
+is the civil damages action brought by the victims of the DC-area
+sniper shootings. Certainly no one on this Subcommittee will ever
+forget the paralyzing fear inflicted on this community by the snipers
+John Lee Muhammad and Lee Boyd Malvo in the Fall of 2002. For some
+families, that fear became tragedy, as 10 people were killed and four
+more injured by the snipers. When the snipers were arrested, they were
+found with the Bushmaster XM-15 assault rifle that had been used in the
+shootings. The gun was traced back to Bull's Eye Shooter Supply, a
+Tacoma, Washington gun shop. Incredibly, though, Bull's Eye had no
+record of what happened to the gun. The shop had no record of sale, no
+record of a background check, and had not reported the gun lost or
+missing. The gun had mysteriously disappeared. Bureau of Alcohol,
+Tobacco, Firearms and Explosives (ATF) audits showed that Bull's Eye
+had mysteriously ``lost'' 238 other guns in a three-year period, an
+average of more than one gun missing every week. Bull's Eye was one of
+the most irresponsible gun dealers in the Nation. It ranked in the top
+.27% of gun dealers nationwide in number of missing guns and in the top
+1% in the number of guns traced to crime.
+ Neither Malvo nor Muhammad could legally have purchased a gun.
+Malvo was a juvenile; Muhammad had a disqualifying domestic violence
+restraining order on his record. Only through the gross negligence of
+Bull's Eye could they have obtained the Bushmaster assault rifle. The
+Brady Center represented eight of the sniper victims and their families
+in a lawsuit against Bull's Eye, charging that the shop's negligence
+put a deadly assault rifle in the hands of the killers. We also sued
+Bushmaster, the manufacturer of the gun, on the ground that companies
+that make high-firepower assault weapons have a special duty to ensure
+that their retailers are responsible corporate citizens. Bushmaster did
+not even require its retail dealers to report to it the results of ATF
+audits, which would have revealed Bull's Eye's chronic problem of
+``missing'' guns. Indeed, even after the press reported the gun shop's
+record, Bushmaster stated that it still considered Bull's Eye a ``good
+customer''.
+ In June of 2003, a Washington State trial judge denied motions to
+dismiss by both Bull's Eye and Bushmaster, deciding that the victims'
+claims were legally valid under general principles of Washington State
+law. The Washington State Court of Appeals denied Bushmaster's appeal
+of this ruling.
+ As former White House Counsel Lloyd Cutler concluded, after
+conducting his own independent analysis, the immunity bill that reached
+the Floor of the Senate in the last Congress would have superceded the
+judge's ruling and required the sniper case to be dismissed. Because
+the legislation was defeated, however, the lawsuit brought by the
+sniper victims went forward. In September of last year, the parties
+reached a settlement, resulting in the payment, by both Bull's Eye and
+Bushmaster, of a combined total of $2.56 million in damages to the
+victims. Bushmaster also agreed in the settlement to make its dealers
+aware of programs to encourage safe sales practices by gun retailers -
+something the company had never done before.
+ Again, consider the outcome of this lawsuit. The sniper victims
+received justice. Bull's Eye and Bushmaster were made accountable for
+their shoddy business practices. And, again, no one declared
+bankruptcy.
+ No one can seriously argue that these were ``frivolous'' lawsuits,
+and yet they would have been blocked by the immunity legislation. It is
+hardly surprising that in February of last year, Henry Cohen, a 28-year
+veteran of the Congressional Research Service and the author of a
+report on gun industry immunity legislation, stated ``it does not
+appear the bill would be limited to frivolous lawsuits. That's my
+neutral assessment.'' \2\
+---------------------------------------------------------------------------
+ \2\ Steve Volk, Specter Shoots Blanks, Philadelphia Weekly,
+February 18, 2004.
+---------------------------------------------------------------------------
+Gun Industry Immunity Legislation Would Protect a Careless Gun
+ Manufacturer that Hired Criminals and Allowed Them to Walk Away
+ with Guns
+ H.R. 800 would also affect currently pending cases brought by gun
+violence victims. An example is the lawsuit brought by the family of a
+young man named Danny Guzman, an innocent bystander who was shot on the
+street in Worcester, Massachusetts on Christmas Eve in 1999. After the
+shooting, the loaded gun used in the shooting was found behind an
+apartment building by a four-year-old child. The gun had no serial
+number.
+ Police investigators determined that the gun was one of several
+stolen from Kahr Arms, a Worcester gun manufacturer, by Kahr's own
+employees who were hired despite their long criminal records. One of
+the thieves, Mark Cronin, had been hired by Kahr to work in its plant
+despite his history of crack addiction, theft to support that
+addiction, alcohol abuse and violence, including several assault and
+battery charges. Cronin had been able to walk out of the factory with
+stolen guns, even before they had been stamped with serial numbers.
+Cronin told an associate that he takes guns from Kahr ``all the time''
+and that he ``can just walk out with them.'' Cronin later pled guilty
+to the thefts. The investigation also led to the arrest of another Kahr
+employee, Scott Anderson, who also had a criminal history and who pled
+guilty to stealing guns from Kahr. At least fifty Kahr firearms
+disappeared from its manufacturing plant in a five-year period.
+Worcester Police Captain Paul Campbell classified the record keeping at
+the Kahr facility as so ``shoddy'' that it was possible to remove
+weapons without detection.
+ Brady Center attorneys represent Danny Guzman's family in a
+wrongful death suit against Kahr arms, charging Kahr with negligence in
+completely failing to screen its employees for criminal history and in
+maintaining a security system so inadequate that employees repeatedly
+were able to walk out of the plant with unserialized guns. In April,
+2003, a Massachusetts trial judge denied Kahr's motion to dismiss the
+suit, finding it supported by general principles of Massachusetts law.
+It is now in pretrial discovery. Had immunity legislation been passed,
+the ruling of the Massachusetts court would have been nullified and
+Danny Guzman's family would be denied the right to justice against a
+gun maker that allowed drug criminals to ``help themselves'' to free
+lethal weaponry.
+gun industry immunity legislation would be a ``breathtakingly radical''
+ revision of liability law for the benefit of a single industry
+ Far from affecting only ``frivolous'' lawsuits, H.R. 800 would
+exempt the gun industry from the oldest principle of our civil
+liability law: that persons, or companies, who act negligently should
+be accountable to the foreseeable victims of their negligence. Indeed,
+in the last Congress, over sixty law professors, from across the
+country, joined a letter calling the legislation ``breathtakingly
+radical'' because it ``affords to a handpicked few - those who make,
+distribute, and sell guns - special protection against the most
+commonplace, long-established form of tort liability: accountability to
+the standard of care required by principles of negligence.'' The
+professors called the immunity bill ``one of the most radical statutory
+revisions of the common law of torts that any legislature - federal or
+state - has ever considered, let along passed.''
+ Proponents of this legislation try to obfuscate its radicalism
+through arguments that simply misstate the law.
+ First, they assert that it is unfair to hold the seller of a
+product responsible for the conduct of a criminal. However, the cases
+brought by Officers McGuire and Lemongello and the sniper victims did
+not seek to hold the defendant gun sellers liable simply because guns
+they sold were used by criminals. Rather, these victims sought to hold
+the gun sellers liable for their own irresponsible conduct that enabled
+criminals to be armed and to commit violent crimes. The courts in West
+Virginia and Washington State based their rulings on the longstanding
+legal doctrine that a defendant can be liable when his own negligent
+conduct creates a foreseeable risk that a third party will commit a
+criminal act. Courts, for example, have applied this doctrine to hold
+landlords liable when their failure to secure their buildings allows
+criminals to victimize their tenants. It has been applied to drivers
+who leave their keys in the ignition in high-crime areas, allowing
+thieves access to a car that is then used to inflict injury on others.
+Courts in these cases are holding the landlords and the drivers liable
+for their own negligence that enabled someone else to commit a criminal
+act.
+ Second, proponents of the bill argue that it is unfair to hold a
+gun company liable if its product, and its conduct, are entirely legal.
+This argument confuses criminal liability, which requires a showing of
+illegal conduct, with civil liability, which does not. The issue in a
+civil negligence case is whether the defendant has acted with
+reasonable care, not whether the defendant has violated a statute. For
+example, when a doctor leaves forceps in a surgical patient, he can be
+liable for his failure to use reasonable care. There is no requirement
+that his conduct violate a statute. It is particularly telling that the
+exception from immunity in H.R. 800 for illegal conduct applies only
+where a gun manufacturer ``knowingly violated'' a State or Federal gun
+statute. In other words, under this bill, a gun company is immunized
+from liability even if it has violated the law, as long as the company
+can demonstrate its ignorance of the law. It is also telling that the
+proponents of gun industry immunity opposed, and defeated, an amendment
+offered last year by Senator Levin (D-Mich.) that would have permitted
+lawsuits where a gun injury or death was caused by ``grossly negligent
+or reckless'' conduct by a gun company. Can there be any doubt that the
+purpose of this legislation is to protect gun manufacturers and dealers
+from civil liability, even if their conduct has been grossly negligent,
+reckless or even illegal?
+ Third, the legislation's supporters assert that they are merely
+asking the Congress to do what over 30 states have already done. It is
+flatly untrue that over 30 states have enacted radical legislation of
+this kind. The vast majority of state immunity statutes apply only to
+suits brought by local governments and have no effect on the legal
+rights of individual gun violence victims. In fact, only five states
+have enacted legislation that limits the legal rights of individual gun
+violence victims to the extent of H.R. 800. For those in Congress who
+regard themselves as guardians of state prerogatives against federal
+encroachment, it is fair to ask: Why should Congress override the
+decisions of 45 states not to strip away the legal rights of gun
+violence victims?
+ In virtually all states, victim claims against gun sellers are
+judged by the courts according to age-old principles of law that apply
+to everyone else. H.R. 800 is an effort by the United States Congress
+to impose a special set of legal rules on state courts that apply only
+to suits against gun companies. This bill is the worst form of special
+interest legislation. Its passage would be a tribute to the power of
+the gun lobby and an embarrassment to the country.
+
+ GUN INDUSTRY IMMUNITY LEGISLATION WOULD ENDANGER COMMUNITIES BY
+ DESTROYING A STRONG INCENTIVE FOR GUN SELLERS TO BEHAVE RESPONSIBLY
+
+ Mr. Chairman, irresponsible conduct by gun sellers has tragic real-
+world consequences. As the Brady Center lawsuits dramatically show,
+reckless gun sellers put guns into the hands of criminals and endanger
+innocent lives. ATF has found from its own gun trafficking
+investigations that licensed gun dealers are the largest single source
+of guns trafficked into the underground market.\3\ Because of
+irrational statutory limitations on its enforcement powers, and limited
+resources, ATF is hampered in its efforts to ensure that gun dealers
+obey the law. The Office of the Inspector General of the Justice
+Department recently estimated that, at ATF's current rate of
+inspections, it will take the Bureau twenty-two years to inspect all of
+the approximately 100,000 current federal firearms licensees.\4\ When
+ATF does inspect dealers, violations of the law often are found, but
+severe statutory constraints on ATF's license revocation powers make it
+difficult for the Bureau to take meaningful action. According to the
+Inspector General, in FY 2003, ATF found that 1,812 of its inspections
+had revealed violations, with an average of over 80 violations for each
+inspection. However, ATF had issued only 54 notices of license
+revocation.\5\
+---------------------------------------------------------------------------
+ \3\ Following the Gun: Enforcing Federal Firearms Laws Against
+Firearms Traffickers, Bureau of Alcohol, Tobacco and Firearms (June
+2000), at 13.
+ \4\ Inspections of Firearms Dealers by the Bureau of Alcohol,
+Tobacco, Firearms and Explosives, Report No. I-2004-005, U.S. Dept. of
+Justice Office of the Inspector General (July 2004), at iii.
+ \5\ Id. at vi.
+---------------------------------------------------------------------------
+ The National Rifle Association has worked for years to weaken ATF's
+enforcement of federal gun laws. It has been tragically successful in
+this endeavor, by limiting ATF's legal authority and its resources. As
+a result, it is all the more important to maintain a strong civil
+liability system to give gun sellers a powerful incentive to behave
+responsibly. One of the recognized purposes of civil liability is to
+encourage individuals and companies to use reasonable care to prevent
+injury to others by ensuring that wrongful and dangerous conduct will
+result in damages liability. Having weakened ATF's enforcement powers,
+now the gun lobby seeks to remove the only remaining incentive for gun
+sellers to consider public safety in their business practices. The
+importance of civil liability was noted by former gun industry insider
+Robert Ricker, who wrote in a sworn declaration that ``until faced with
+a serious threat of civil liability for past conduct, leaders in the
+industry have consistently resisted taking constructive voluntary
+action to prevent firearms from ending up in the illegal gun market.''
+\6\
+---------------------------------------------------------------------------
+ \6\ Mr. Ricker is a former NRA lawyer and former Executive Director
+of the American Shootings Sports Council, an industry trade
+association. His revelations about the gun industry are discussed in
+greater depth in the attached Brady Center special report, Smoking
+Guns: Exposing the Gun Industry's Complicity in the Illegal Gun Market,
+which details much of evidence against the gun industry uncovered in
+litigation.
+---------------------------------------------------------------------------
+ Far from pursuing legislation to strengthen ATF, proponents of
+immunity in Congress would rather reassure reckless gun sellers that
+they need no longer worry about the prospect that courts will hold them
+accountable to the victims of their conduct. If H.R. 800 passes, it
+will mean more gun sellers acting with utter contempt for public
+safety, with disastrous consequences for communities throughout the
+Nation. This is why, Mr. Chairman, there is substantial opposition to
+this legislation in the law enforcement community, including the Major
+Cities Chiefs Association, the International Brotherhood of Police
+Officers, the Police Foundation, the National Black Police Association,
+the Hispanic Police Command Officers Association and several state
+associations of police chiefs.\7\ In addition to recognizing that
+police officers like David Lemongello and Ken McGuire may be among the
+gun victims whose rights are infringed by this bill, these
+organizations also understand that H.R. 800 will only mean more illegal
+guns on the streets. It only takes a few ``bad apple'' gun dealers to
+funnel thousands of guns to criminals. ATF has found that only one
+percent of licensed gun dealers account for 57% of the guns traced to
+crime.\8\ These law enforcement organizations agree with us that good
+gun dealers don't need legal immunity; bad gun dealers don't deserve
+it.
+---------------------------------------------------------------------------
+ \7\ A letter opposing H.R. 800 from these organizations, and other
+members of the law enforcement community, is attached.
+ \8\ Commerce in Firearms in the United States, Bureau of Alcohol,
+Tobacco and Firearms (February 2000), at 2.
+---------------------------------------------------------------------------
+ GUN INDUSTRY IMMUNITY LEGISLATION IS FAR MORE RADICAL THAN TORT REFORM
+
+ Finally, it is important to distinguish H.R. 800 from other
+legislation this Congress has considered, and will consider, to reform
+our civil justice system. This bill is far more radical than any other
+proposal the Congress will address. Unlike class action reform, H.R.
+800 does not simply change the legal forum in which gun liability cases
+are considered; it protects reckless gun sellers from liability in any
+forum. Unlike medical malpractice reform, H.R. 800 does not simply
+limit the amount and kind of damages that can be recovered by gun
+violence victims against reckless gun sellers; it deprives victims of
+any recovery. Unlike the asbestos litigation reform proposals, H.R. 800
+sets up no alternative to the court system for victims to be
+compensated; it denies all avenues for compensation. In short, H.R. 800
+gives the gun industry special legal privileges that other industries
+can only dream about. And it makes the victims of reckless gun sellers
+into ``second-class'' citizens, who lack the basic civil liberties of
+other Americans who have been injured by the wrongful conduct of
+others.
+ For these reasons, on behalf of the Brady Center to Prevent Gun
+Violence, and the brave gun violence victims we represent in court, I
+urge you to oppose this legislation. Thank you again for the
+opportunity to share my views.
+
+ ATTACHMENT
+
+
+
+ Mr. Chabot. Mr. Beckman, you are recognized for 5 minutes.
+
+ TESTIMONY OF BRADLEY T. BECKMAN, BECKMAN AND ASSOCIATES,
+ COUNSEL TO NORTH AMERICAN ARMS
+
+ Mr. Beckman. Good morning, Mr. Chairman and Members of the
+Subcommittee. My name is Bradley Beckman and I'm National
+Counsel for North American Arms, which is in Mr. Cannon's
+district.
+ The legal assault that has been brought against North
+American Arms and the other manufacturers by Mr. Henigan's
+organization and various municipalities are nothing short of
+legal terrorism. This has been an assault that has been ongoing
+for many years.
+ North American Arms is a small manufacturer, relatively
+modest-sized, been in business for 30-odd years. It employs a
+number of people and it has a number of suppliers that are
+employed and it goes on down the line. The burden that is put
+upon a small company like North American Arms and many that are
+similarly situated is extraordinary.
+ I listened to Mr. Henigan's comments about what this bill
+has to do with, and respectfully, I suggest that this bill has
+nothing to do with terrorism, 50-caliber ammunition, armor-
+piercing bullets, copkiller handguns, but it has everything to
+do with prevention of legal terrorism.
+ Companies like North American Arms have been essentially
+held for ransom because they've been told if they don't,
+they're going to continue to be assaulted with litigation of
+this sort.
+ I listened with interest to the comments about the Bull's
+Eye case because I was involved in that case. I was engaged as
+trial counsel. The acts of those criminals were just that. That
+was a firearm that was stolen. Bushmaster sold a lawful product
+in a non-defective condition which was openly stolen from the
+retailer. This legislation, I submit, under my understanding of
+the way it is written, would not prevent litigation such as
+that against a wrongful seller, somebody who has violated the
+law by allowing that firearm to escape their clutches.
+ With regard to the Lemongello case in West Virginia, we're
+talking about, again, tragedies where we've seen law
+enforcement officers killed. Ruger sold another product in a
+non-defective condition in compliance with a host of laws. It
+did nothing wrong. To suggest that this legislation will
+prevent somebody from getting into the courthouse door, I think
+is simply a misstatement of what this bill is designed to
+prevent.
+ Mr. Henigan was involved since the mid-1990's with
+approximately 30 lawsuits brought by municipalities throughout
+the country--Cincinnati, several in California, Detroit. Each
+and every one of them has been unsuccessful. However, the cost
+has been staggering. That is what this legislation is about.
+ If the courthouses in America were designed to address
+that, then I would submit that we wouldn't have a legislature.
+We would have just a judicial branch. But this is up to the
+legislative body to make the laws. If our legislature should
+determine that firearms are illegal in some form or another,
+that's a matter for another day. This is to prevent the
+proverbial gun in the ribs to the manufacturers, the
+distributors, and the lawful sellers who comply with a very
+large host of law and regulation.
+ If somebody could explain--I listened to Mr. Smith ask what
+liability is left. Well, we have retailers who are complying
+with law, distributors, and manufacturers. As we go through the
+chain, as we find somebody who violates the laws that presently
+exist, that's not going to be covered by this legislation. What
+is covered is the--truly a perversion of the tort system to try
+to use the tort law of public nuisance, which has been one of
+the prime sticks that the plaintiffs have tried to use against
+this industry, to essentially bankrupt them, and while there
+may have been some companies larger than others, better able to
+withstand some of the legal assault, I can tell you from the
+perspective of a modest-sized manufacturer like North American
+Arms, it cannot withstand that assault and there are a number
+of other similarly situated companies.
+ I see that my time is expiring, and I thank you.
+ Mr. Chabot. I can assure you you'll have an opportunity to
+respond to questions and speak some more.
+ [The prepared statement of Mr. Beckman follows:]
+
+ Prepared Statement of Bradley Beckman
+
+ Mr. Chairman, my name is Bradley Beckman and I am here representing
+a modest-sized firearms manufacturer with which I am sure you are
+familiar, North American Arms. North American Arms is based in your
+district. I want to begin by thanking you for holding this hearing. The
+legal assault on the firearms industry by opportunistic lawyers and
+anti-gun politicians threatens to bankrupt an entire industry that
+scrupulously follows all federal, state and local laws in the
+manufacture of our products and their sale to federally licensed
+firearms distributors.
+ North American Arms employs approximately 40 people and specializes
+in the manufacture of small-sized, personal protection firearms. Many
+individuals who choose to carry our high-quality products are members
+of the law enforcement community who use them as a second or ``backup''
+firearm to their standard sidearm. North American Arms has been named
+in several of the state and municipal suits against the firearms
+industry.
+ The lawsuits brought against gun manufacturers are nothing short of
+outrageous. Holding gun makers liable for the criminal misuse of our
+products--one of the central accusations in these suits--is akin to
+holding Ford, Chevy or Honda responsible for the illegal actions of a
+drunk driver or holding Kodak responsible for the use of their film in
+the vile world of child pornography. It is an accusation that defies
+common sense. While these lawsuits barely pass the straight face test,
+the consequences of these suits are no laughing matter.
+ North American Arms is literally being crushed under the weight of
+legal expenses. Money that could be used for developing new markets,
+hiring workers, improving firearms design and safety is instead
+channeled to fund the huge costs associated with the legal defense of
+the company.
+ These lawsuits are nothing short of legal backmail-lawyers,
+politicians and anti-gun groups want to achieve in the courtroom
+draconian changes in gun laws that have been rejected by Congress and
+state legislatures. Their message is simple: ``settle with us or we
+will bankrupt you with lawsuits.'' This legal extortion must be
+stopped.
+ North American Arms is a responsible firearms manufacturer that
+adheres strictly to all laws governing the manufacture and sale of our
+products to distributors. We have an excellent relationship with law
+enforcement. We have done nothing wrong, yet if a judge and jury in,
+for example, New York, decide against our industry it holds the
+potential of bankrupting not just North American Arms, but the entire
+U.S. firearms industry. It is doubtful that North American Arms or
+other manufacturers could post the necessary bond to appeal a verdict.
+If these suits are successful, they will be a wrecking ball on our
+national economy. Any member of Congress from Michigan should be ready
+for a similar assault on the auto industry. We already see suits
+against purveyors of fast food. The list of targeted industries could
+go on and on.
+ I want to close with two quotes. The first from a recent decision
+by California Judge James Marchiano, writing for a unanimous state
+Court of Appeals decision in favor of the firearms industry just last
+month. Judge Marchiano wrote:
+
+ ``The only business practice the defendants in this case have
+ engaged in is marketing their products in a lawful manner to
+ federally licensed dealers . . .''
+
+ ``In this case, there is no causal connection between any
+ conduct of the defendants and any incident of illegal
+ acquisition of firearms or criminal acts or accidental injury
+ by a firearm. Defendants manufacture guns according to federal
+ law and guidelines.''
+
+ In March 2002, the City of Boston dismissed with prejudice its
+lawsuit against firearms manufacturers. The city, facing mounting legal
+bills and recognizing that it would lose its case, stated in its
+dismissal that:
+
+ ``. . . members of the Industry and firearms trade associations
+ are genuinely concerned with and are committed to, the safe,
+ legal and responsible sale and use of their products . . . The
+ Industry and the City believe that through cooperation and
+ communication they can continue to reduce the number of firearm
+ related accidents, can increase awareness of the issues related
+ to the safe handling of storage of firearms, and can reduce the
+ criminal acquisition of firearms.''
+
+ Mr. Chairman, passage of H.R. 800 is common-sense judicial reform.
+This bill will protect jobs, prevent the misuse of the courts to
+circumvent elected officials and prevent abuse of the judicial system.
+ Thank You.
+
+ Mr. Chabot. Mr. Keane?
+
+ TESTIMONY OF LAWRENCE G. KEANE, SENIOR VICE PRESIDENT AND
+ GENERAL COUNSEL, NATIONAL SHOOTING SPORTS FOUNDATION, INC.
+
+ Mr. Keane. Chairman Cannon, distinguished Members of the
+Subcommittee, my name is Lawrence Keane and I'm the Senior Vice
+President and General Counsel for the National Shooting Sports
+Foundation, the trade association for the firearms industry. We
+strongly support this bill because it's an important common
+sense legal reform that will help restore integrity and
+fairness to our nation's judicial system by preventing lawsuit
+abuse.
+ This vital, bipartisan legislation is critical to
+protecting America's firearms industry from destruction and
+bankruptcy at the hands of opportunistic trial lawyers,
+seriously misguided politicians, and radical anti-gun interest
+groups who seek to destroy and bankrupt our industry through
+massive damage awards and/or bleeding us dry through ever-
+mounting legal fees. These ``regulation-through-litigation''
+lawsuits misuse our judicial system in an attempt to dictate to
+all Americans public policy choices that are rightfully the
+purview of Congress and the elected State legislators. Under
+our Constitution, those policy choices are for Congress, not
+judges.
+ The threat posed by ``regulation-through-litigation'' is
+why the U.S. Chamber of Commerce, the National Association of
+Manufacturers, the National Association of Wholesalers, and
+others support this bill. As the National Association of
+Manufacturers has said, ``It is a certainty that other
+businesses will be the next target if these groups succeed in
+misusing the courts against the firearms industry.'' This
+legislation is also supported by organized labor. The United
+Mine Workers, representing about 1,000 Remington factory
+workers, said the bill will, ``help prevent lawsuits by various
+parties that are intended to shut down the legitimate and legal
+firearms industry in the United States because of the improper
+use of firearms by individuals.'' These lawsuits seek to blame
+federally-licensed firearms manufacturers for the actions of
+criminals.
+ Despite some industry success in the courts, this well-
+funded, highly-coordinated onslaught of abusive lawsuits
+against Members of our industry continues unabated. A single
+$100 million verdict will bankrupt virtually all the
+defendants.
+ Members of our industry are being sued today, right here in
+the District of Columbia, under a law that imposes absolute
+liability upon manufacturers for criminal shootings occurring
+in the District because they lawfully sold a gun that was then
+later illegally brought into the District and used in a crime.
+Bushmaster is being sued under this same statute with respect
+to the firearm misused in the sniper case.
+ But the poster child for this bill is a case called Ileto
+v. Glock, where a manufacturer is being sued in Federal court
+in California for selling a firearm to a police department in
+Washington State that was later used in a criminal shooting. A
+distributor is being sued in that case, even though it never
+owned, possessed, or sold the firearm in question. Winning on
+the merits is not necessary in order for these politician and
+anti-gun activists, like Mr. Henigan, to impose through
+litigation or financially extorted or coerced settlements, a
+gun control agenda repeatedly rejected by Congress and State
+legislature.
+ These anti-gun plaintiffs can implement their gun control
+policies through the entire nation if the coercive effect
+resulting from the staggering cost to defend these cases forces
+manufacturers into a Hobson's choice of capitulation or
+bankruptcy.
+ The industry-wide cost to defend these cases is staggering.
+It exceeds $200 million, which is a huge sum for a small
+industry like ours that taken together doesn't equal a simple
+Fortune 500 company. These lawsuits threaten the very existence
+of the manufacturers, such as Sigarms, that produce the tools
+for law enforcement and military agencies that they use to
+protect America's freedoms here and abroad every day. These
+lawsuits have national defense and homeland security
+implications.
+ The legislation you are considering today is as important
+for what it does not do. It does not, as Mr. Henigan tries to
+allege, close the courthouse door to those who have been
+injured by firearms that have been, for example, illegally sold
+or have been negligently entrusted or are defectively designed.
+The bill expressly provides that injured parties will be able
+to assert well-established tort law claims against the
+manufacturers themselves of firearms.
+ The Wall Street Journal in an editorial got it right when
+it said, ``This isn't immunity, as some critics claim. The gun
+makers and distributors would still have to abide by product
+liability laws and still face civil suits for violating
+regulations on the sale and distribution. But just as Sony is
+not responsible for someone who uses a camcorder to film child
+pornography, no longer could Beretta be held responsible for
+someone using its legally purchased product to rob a liquor
+store.'' It's that judicial abuse that this legislation is
+carefully drafted to stop, and nothing more.
+ There are several refinements to the bill that was passed
+by the House in the 108th Congress. We support those changes
+because they enhance and clarify the bill's purpose and intent.
+ We agree with President Bush, who said, ``Recently our
+nation depends on a fair legal system that protects people who
+have been harmed without encouraging junk lawsuits that
+undermine the confidence in our courts while hurting our
+economy, costing jobs, and threatening small business.'' Over
+30 States have already enacted similar laws designed to stop
+junk lawsuits that are intended to destroy our industry and to
+achieve gun control regulation through litigation.
+ The time has come for Congress to enact common sense legal
+reform to prevent an unconstitutional attempt to circumvent
+Congress and State legislatures, to restore integrity and
+fairness to our judicial system, to protect one of America's
+oldest and most important industries, and to prevent the loss
+of thousands of American jobs vital to the health of our
+economy, and to protect a critical component of our national
+security industrial base.
+ Today, it's guns. We are already seeing similar legal
+assaults on the fast food industry. Are cars, alcohol, and
+distilled spirits next in line at the courthouse door? We've
+already seen it start with alcohol.
+ The National Shooting Sports Foundation urges you to vote
+in favor of the Protection of Lawful Commerce in Arms Act.
+Thank you, Mr. Chairman, for permitting the National Shooting
+Sports Foundation the opportunity to address the Subcommittee
+and for the Subcommittee's time and attention.
+ Mr. Cannon. [Presiding.] Thank you, Mr. Keane.
+ [The prepared statement of Mr. Keane follows:]
+
+ Prepared Statement of Lawrence G. Keane
+
+ Chairman Cannon and distinguished members of the Subcommittee, my
+name is Lawrence G. Keane. I am the senior vice president and general
+counsel of the National Shooting Sports Foundation, Inc. (NSSF). The
+National Shooting Sports Foundation appreciates the opportunity to
+appear before the Subcommittee this morning to offer testimony in
+support of the Protection of Lawful Commerce in Arms Act (H.R. 800).
+ Formed in 1961, the National Shooting Sports Foundation, with
+approximately 2,500 members, is the trade association for the firearm,
+hunting and recreational shooting sports industry. NSSF is proud of our
+industry's cooperative relationship with law enforcement, as
+exemplified by the NSSF--Bureau of Alcohol, Tobacco, Firearms and
+Explosives (ATF) partnership program called Don't' Lie for the Other
+Guy that ATF Director Carl Truscott described as ``vital in educating
+Federal firearms licensees (FFL's) and their employees how to recognize
+and deter the illegal purchase of firearms through straw purchases.''
+He called the program ``an important tool for ATF as we pursue our
+missions of preventing terrorism, reducing violent crime, and
+protecting the public through Project Safe Neighborhoods and other
+initiatives.'' NSSF's commitment to promoting the safe and responsible
+use of firearms is typified by our Project ChildSafe program. Operating
+under a grant from the U.S. Department of Justice, NSSF, in partnership
+with state and local governments throughout the United States, has
+distributed to the public over 25 million firearm safety kits, which
+includes a free firearm lock. We are very proud that Don't Lie and
+Project ChildSafe are both components of the Justice Department's
+Project Safe Neighborhoods program.
+ We strongly support the Protection of Lawful Commerce in Arms Act
+(H.R. 800) because it is an important common sense legal reform that
+will help restore integrity and fairness to our nation's judicial
+system by preventing lawsuit abuse. This vital bipartisan legislation
+is critical to protecting America's firearm industry from destruction
+and bankruptcy at the hands of opportunistic trial lawyers, seriously
+misguided politicians and radical antigun interest groups who seek to
+destroy and bankrupt our industry through massive damage awards and/or
+bleed us dry through ever mounting legal fees. These predatory lawsuits
+misuse and abuse our nation's judicial system in an attempt to dictate
+to all Americans public policy choices that are rightfully the purview
+of Congress and elected state legislators. In dismissing one such suit,
+a Florida appellate judge astutely observed that
+
+ [Miami-Dade County's] request that the trial court use its
+ injunctive powers to mandate redesign of firearms and declare
+ that the [firearms manufacturers'] business methods create a
+ public nuisance, is an attempt to regulate firearms and
+ ammunition through the medium of the judiciary. . . . The
+ County's frustration cannot be alleviated through litigation as
+ the judiciary is not empowered to `enact' regulatory measures
+ in the guise of injunctive relief. The power to legislate
+ belongs not to the judicial branch of government but to the
+ legislative branch.
+
+ This misuse of lawsuits by interest groups to force public policy
+changes, so-called ``regulation through litigation,'' when under our
+Constitution those policy choices are for Congress and state
+legislatures to make, represents a direct threat to the entire business
+community and the nation's economy. This is why the U.S. Chamber of
+Commerce, the National Association of Manufacturers, the National
+Association of Wholesalers, the American Tort Reform Association, and
+many others support H.R. 800. As National Association of Manufacturers
+executive vice president Michael Baroody has said, ``It is a certainty
+that other businesses will be the next target if these groups succeed
+in misusing the courts against the firearms industry.''
+ This legislation is supported by organized labor as well. Cecil
+Roberts, president of the United Mine Workers of America, which
+represents nearly a thousand workers at the Remington Arms Company's
+plant in New York, said this bill ``will help prevent lawsuits by
+various parties that are intended to shut down the legitimate and legal
+firearms industry in the United States because of improper use of
+firearms by individuals.'' He cautioned, ``The United States is losing
+our industrial base and since January 2001 we have lost 2.5 million
+industrial jobs in the U.S. . . . We need to take steps to protect and
+encourage growth of our industrial base, including our firearms
+manufacturers.''
+ Beginning in 1998, a group of approximately forty urban
+politicians, aligned with contingency-fee trial lawyers and anti-gun
+activists, have flooded our nation's courts with lawsuits filed against
+law-abiding, federally licensed firearm manufacturers, wholesale
+distributors and retailers. These suits blame federally licensed
+firearm manufacturers for the actions of criminals. The plaintiffs in
+these cases allege that the sale of a legal product in full compliance
+with the vast and extensive array of federal, state and local laws and
+regulations somehow causes criminal violence to occur. They allege that
+members of the industry are subverting the law by knowingly and
+willingly selling guns to criminals and are funneling firearms to the
+so-called ``criminal market.'' These despicable allegations are both
+patently false and highly offensive and defamatory to the tens of
+thousands of men and women who work in our industry.
+ Despite some success in the courts, this well-funded, highly
+coordinated onslaught of abusive lawsuits against members of our
+industry continues unabated. Several cases are currently pending at the
+trial court level with several more cases at various stages of appeal
+that could be returned to trial courts for costly and time-consuming
+discovery and trial. A single hundred million dollar verdict will
+bankrupt virtually all of the defendants. In fact, the companies would
+almost certainly be unable to post the bond required to enable them to
+appeal such an award. Recently, the City of New York enacted into law
+the Gun Industry Responsibility Act that imposes absolute liability on
+law abiding, federally licensed firearm manufacturers and dealers for
+criminal shootings that occur in New York City. Members of our industry
+are being sued today right here in the District of Columbia under a
+similar law that imposed absolute liability upon manufacturers and
+dealers for criminal shootings occurring in the District because they
+lawfully sold a firearm that was then illegally brought into the
+District and used in the commission of a crime. A manufacturer is being
+sued in federal court in California for selling firearms to a police
+department in Washington State that was later used in a criminal
+shooting. In that same case, a distributor is being sued even though it
+never owned, possessed or sold the firearm in question. This case,
+Ileto v. Glock, is the poster child for the Protection of Lawful
+Commerce in Arms Act.
+ Winning on the merits is not necessary in order for these
+politicians and antigun activists to impose through litigation, or
+financially extorted and coerced settlements, a radical gun control
+agenda repeatedly rejected by Congress and state legislatures, and not
+supported by the American public. At the time he filed his suit,
+Chicago Mayor Richard Dailey said, ``We're going to hit them where it
+hurts--in their bank accounts. . .'' Andrew Cuomo, then Housing and
+Urban Development Secretary, threatened firearm manufacturers with
+``death by a thousand cuts.'' NAACP president Kweisi Mfume said its
+lawsuit was ``an effort to break the backs'' of industry members. These
+antigun plaintiffs can implement their gun control policies throughout
+the entire nation if the coercive effect resulting from the staggering
+financial cost to defend these baseless suits forces industry members
+into a Hobson's choice of either capitulation or bankruptcy. Companies
+have gone bankrupt, and thousands of people thrown out of work,
+vindicating themselves against baseless lawsuits; just ask Dow Corning.
+ The collective, industry-wide cost to defend these ill-conceived,
+politically motivated, predatory lawsuits has been truly staggering.
+Exact figures are unavailable because the defendants are competitors,
+and each considers its defense costs to be confidential business
+information. However, based on discussions with insurance industry
+executives, manufacturers' corporate counsel, reading cost estimates in
+various publications and NSSF's own experience as a defendant in these
+cases, I believe a conservative estimate for the total, industry-wide
+cost of defending ourselves to date now exceeds $200 million dollars.
+This is a huge sum of money for a small industry like ours. The firearm
+industry taken together would not equal a Fortune 500 company.
+ The cost of litigation is borne almost exclusively by the companies
+themselves. With few exceptions, insurance carriers have denied
+coverage. These antigun plaintiffs have carefully drafted their
+complaints to take them outside of liability insurance coverage in
+order to apply maximum financial pressure on the defendant
+manufacturers. Because of these lawsuits, firearm industry members now
+confront skyrocketing premium increases when renewing their insurance
+policies. In addition, insurance policies now universally exclude
+coverage for these types of suits. This has resulted in large, across-
+the-board price increases for consumers. In addition, in these trying
+economic times, taxpayers of the cities that have chosen to pursue the
+utterly discredited notion that manufacturers are responsible for the
+acts of criminals are forced to shoulder their city's cost of pursuing
+such a lawsuit, money that would be better spent hiring more police
+officers, procuring new equipment or funding critical social services.
+ These lawsuits threaten the very existence of the manufacturers
+that produce the tools our military and law enforcement agencies use
+every day to protect America and our freedoms both here at home and
+abroad. If these companies are driven out of business, from whom will
+our military and law enforcement purchase firearms? Make no mistake
+about it; these lawsuits have national defense and homeland security
+implications.
+ The legislation you are considering today is perhaps more important
+for what it does not do. It does not, as antigun interest groups have
+falsely alleged, ``close the courthouse doors'' to those who have been
+injured by firearms that have been illegally sold, supplied to a person
+likely to use the firearm in a manner involving an unreasonable risk of
+injury to himself or another, or prevent a suit due to a defectively
+designed or manufactured product. The bill expressly provides that
+injured parties will be able to assert well-recognized tort law claims
+against the manufacturers and sellers of firearms. The Wall Street
+Journal clearly stated in an editorial that, ``This isn't immunity, as
+some critics claim. Gun makers and distributors would still have to
+abide by product liability laws and still face civil suits for
+violating regulations on sales or distribution. But just as Sony is not
+responsible for someone who uses a camcorder to film child pornography,
+no longer could Beretta be held responsible for someone using its
+legally purchased product to rob a liquor store.'' (Wall Street
+Journal, April 17, 2003.) It is that abuse of our judicial system that
+this legislation is carefully drafted to stop, nothing more and nothing
+less.
+ The loudest voices arrayed in opposition to this legislation are
+the same antigun interest groups that are orchestrating and financing
+the litigation assault to regulate the firearm industry in ways
+Congress and state legislatures have roundly rejected and hold no
+support with the American public.
+ There are several refinements between the bill passed by the House
+in the 108th Congress (H.R. 1036) and this legislation. One change
+better clarifies that suits can proceed where there is a defective
+product, but that when a criminal volitionally pulls the trigger
+causing injury, the manufacturer cannot be sued. As revised, for
+instance, a juvenile who while target shooting without written
+permission from his parents (a violation of 18 U.S.C. Sec. 922(y)) is
+injured by defective ammunition could still be able to bring a suit
+against the ammunition manufacturer. H.R. 800 defines a ``trade
+association'' based on Internal Revenue Code and regulations. This new
+definition avoids specious arguments that the former definition was
+intended to protect the National Rifle Association. There was never any
+such intention in the previous bill, and this language makes that
+clear. H.R. 800 provides that manufacturers or sellers can be sued if
+they ``knowingly'' violate laws applicable to the sale or marketing of
+the product, and the violation is a proximate cause of harm to the
+plaintiff. By comparison, H.R. 1036 said ``knowingly and willfully.''
+We support these refinements because they enhance and further clarify
+the bill's purpose and intent.
+ Over thirty states have already enacted similar laws to stop
+``junk'' lawsuits designed to destroy this industry and to achieve gun
+control regulation through litigation. We agree with President Bush who
+recently said, ``Our country depends on a fair legal system that
+protects people who have been harmed without encouraging junk lawsuits
+that undermine confidence in our courts while hurting our economy,
+costing jobs and threatening small businesses.'' The time has come for
+Congress to enact a common sense legal reform to restore integrity and
+fairness to our judicial system, protect American jobs and industry and
+to prevent an unconstitutional attempt to circumvent Congress and state
+legislatures. We call upon Congress to prevent lawsuit abuse. The
+future of one of America's oldest, most important industries and the
+loss of thousands of American jobs vital to the health of our economy
+is at stake, as is a critical component of our national security
+industrial base.
+ The shuttering of the firearm industry will hit states--especially
+rural states--especially hard. Each year hunters and shooters spend $21
+billion generating 366,344 jobs that pay more than $8,896,623,900 in
+salaries and wages and provide $1,223,049,215 in state tax revenue.
+ In closing, if these lawsuits are not stopped, then it is open
+season on any industry. It is guns today, and we are already seeing
+similar legal assaults on the fast food industry--cars, alcohol and
+distilled spirits could be next in line at the courthouse door. In some
+way, these lawsuits will impact job creation in your districts and
+states and not for the better.
+ The National Shootings Sports Foundation urges you to vote in favor
+of the Protection of Lawful Commerce in Arms Act (H.R. 800). I thank
+you Mr. Chairman for permitting the NSSF to address the Subcommittee
+and for the Subcommittee's attention this morning.
+
+ ATTACHMENT
+
+
+
+ Mr. Cannon. We'd like to welcome Mr. Delahunt from
+Massachusetts, who's joined us.
+ We have a vote coming up, and I'd hate to hold the panel
+through that vote and it would be hard for Members to come
+back, so I'd ask unanimous consent to limit questioning by the
+Members to 3 minutes. No objection, so ordered.
+ Mr. Watt, would you like to begin?
+ Mr. Watt. Thank you, Mr. Chairman. I think in light of our
+time constraints, I think I will not ask any questions. We've
+been through this several times now in this Committee, and here
+we go again. I mean, I made that point in my opening statement.
+ I would just say that this whole notion that Mr. Beckman
+and Mr. Walton have--obviously, it's some public relations
+thing that you've undertaken to compare this war to the war in
+Iraq or call this legal terrorism and make it in some kind of
+way comparable to terrorism in general, I think is insulting to
+your argument, and I'll just leave that alone and tell you
+that's my opinion. That's a constructive suggestion. For you
+all to compare these things like that, I think is a bad, bad
+public relations move.
+ I yield back, Mr. Chairman.
+ Mr. Cannon. The gentleman yields back.
+ Mr. Gohmert, would you like to question the witnesses?
+ Mr. Gohmert. Yes, I would.
+ Mr. Cannon. The gentleman is recognized for 3 minutes.
+ Mr. Gohmert. Thank you. Mr. Henigan, let me ask, what do
+you take the term negligent entrustment to mean?
+ Mr. Henigan. Congressman, negligent entrustment is actually
+defined in this bill, so it has a very special definition that
+is not necessarily the same as the common law definition.
+According to this bill, the suits that would be allowed under
+that doctrine are suits in which a seller transfers a gun to an
+obviously dangerous person and then that person misuses the gun
+against someone. So it would be, for example, a situation where
+a seller sells a gun to someone who is intoxicated and then
+goes out and shoots someone. That is a very rare kind of case.
+ The much more frequent kind of case is the kind of thing
+that happened in that gun shop in West Virginia, where the sale
+of the gun is to a gun trafficking team and the person who
+pulled the trigger was nowhere near the gun shop, but
+nevertheless, the sale was incredibly suspicious. It had all
+the earmarks of a sale to people who were going to take those
+guns and sell them directly into the illegal market.
+ So the doctrine of negligent entrustment as it is defined
+in this bill would not have preserved that case at all.
+ Mr. Gohmert. Well, it does seem, though, that the Second
+Amendment, when it says--talks about not infringing the right
+to keep and bear arms, doesn't mean what one constable back in
+Texas thought it meant, that he had the right to wear short
+sleeves. But until such time as that is amended, it seems like
+we should be affording people the right to act within the
+purview of that amendment.
+ I yield back the remainder of my time. Thank you, Mr.
+Chairman.
+ Mr. Cannon. Thank you, Mr. Gohmert.
+ Mr. Van Hollen?
+ Mr. Van Hollen. Thank you, Mr. Chairman.
+ Whenever the case of the sniper victims comes up, the
+proponents of the bill say, oh, no, no, no, we're not talking
+about trying to bar people like the sniper victims and their
+families from court. It's other people in the world. In fact,
+as I understood your testimony, Mr. Beckman, you said your
+understanding of the bill was it would not bar that case. Is
+that what your testimony was?
+ Mr. Beckman. Insofar as the claims against the manufacturer
+of that firearm----
+ Mr. Van Hollen. Let--go ahead.
+ Mr. Beckman. Insofar as the claims against the manufacturer
+of that firearm, I believe that this legislation would prevent
+that. But respectfully, I suggest that Bushmaster sold its
+lawful product in a non-defective condition, which the Congress
+of the United States as well as every State said was a lawful
+product.
+ Mr. Van Hollen. If I could, let me focus on the gun store,
+the gun store that sold the weapons. Is it your testimony that
+a lawsuit against the gun store on the facts of the sniper case
+would still be allowed to go forward under this bill?
+ Mr. Beckman. Well, it----
+ Mr. Van Hollen. And if so, if you could point to the
+specific provisions--specific provisions of this bill, because,
+as you know, when you go in front of a court of law and you sit
+before a judge, you've got to make an argument based on the
+language in this bill. If you could tell me, based on the
+facts, what provisions would allow that case would go forward,
+I'd appreciate it.
+ Mr. Beckman. Okay. That firearm was not sold by Bull's Eye.
+It was stolen by Bull's Eye. Strike that, stolen from Bull's
+Eye. The qualified civil liability action would not include, in
+my opinion, the failure of Bull's Eye to have maintained
+control over whatever it--its inventory, because we already
+have plenty of Federal law that dictates the inventory control
+that the firearms manufacturers--the firearms retailers should
+have, and it is the unlawfulness use that is--it would not be
+precluded. And it would deal with, perhaps--you're asking me to
+interpret this draft statute as I sit here, and I believe----
+ Mr. Van Hollen. Right. I'm not--you made a statement in
+your testimony that I interpreted to mean that you thought that
+this would allow this to go forward, so I thought that you
+looked at the provisions. That's all.
+ Mr. Beckman. Yes, sir, I have, and I believe that the claim
+against the retailer would have not been foreclosed under the
+language of the statute. I believe that it would have
+foreclosed the----
+ Mr. Van Hollen. And all I was asking you, Mr. Beckman,
+based on your reading of the statute, what provisions in the
+statute, based on your understanding of the facts, would allow
+it to go forward, because the fact of the matter is, although
+over 250 weapons were missing from this store, under the
+requirements in this bill, you have to show a direct connection
+between the particular gun that was stolen and used in the
+shootings and a proximate cause between the disappearance of
+that gun and the shootings.
+ And I just--the way I read this bill, and the way many
+lawyers who have looked at the bill and written opinions and
+submitted opinions to the Congress, it's quite clear, I
+believe, that those claims would be barred against the store.
+ Mr. Beckman. Well, but again, I respectfully disagree, sir,
+because I believe that it is a violation of Federal law,
+existing Federal law, for the retailer to have not reported the
+theft.
+ Mr. Van Hollen. If I could ask you, the requirement is if
+you know of a theft, right?
+ Mr. Beckman. Well----
+ Mr. Van Hollen. In this case--Mr. Chairman, I don't mean to
+belabor this point, but I'd just like to just wrap up, because
+in this case, the testimony was that about 230 weapons had been
+missing from the store. Their testimony was, and it was
+unrefuted, that they were not aware of the theft of the
+Bushmaster rifles used in the sniper killings until after the
+killings took place, and therefore, there would be no legal
+obligation on them to report something that they did not know
+about under the statutes.
+ Even though the record is clear that this is a gun store
+that did not keep control over its weapons--that's why 230 were
+missing and they couldn't account for them. But the way this is
+written, because their testimony is they didn't know about it,
+therefore, they didn't have a legal obligation to report it.
+Even though they were totally negligent in keeping control of
+their arsenal, of the guns they were selling, they couldn't--
+the claim would not be brought.
+ I would ask if you could, in a written statement, show us
+how that is not the case. Thank you, Mr. Chairman.
+ Mr. Beckman. I'd be pleased----
+ Mr. Cannon. You're welcome to answer that question, if
+you'd like.
+ Mr. Beckman. I believe that I've given my view as to why
+the statute would not have precluded that case against the
+retailer. It's still a violation of Federal law. It is just
+akin go what Mr. Henigan explained in the West Virginia case,
+where it was a knowing violation of the straw purchase. That
+has been and will remain a violation of Federal law. Where we
+have somebody who violates the law, that's not within the
+purview of this statute. What is within the purview of this
+statute is the 30-odd lawsuits that were brought by
+municipalities around this country, all of which had no effect
+whatsoever on this industry other than to cost them staggering
+sums of money. And indeed, the lawsuits themselves were abject
+failures. That's what this legislation is designed to address.
+ Mr. Van Hollen. Mr. Chairman, at some point, if you could
+maybe later supply for the record the particular provision in
+this bill that you say would still allow that lawsuit to go
+forward, because what this bill does is provide general
+liability and creates certain exceptions. If you could, please,
+pinpoint what in the bill allows the lawsuit against the seller
+of the weapons used in the sniper suit to go forward, I would
+appreciate it.
+ Mr. Cannon. And if you could get that within 5 days, we
+would appreciate that, so that we can include it in the record.
+ Mr. Beckman. I'd be pleased to do so.
+ Mr. Cannon. Thank you, Mr. Beckman.
+ The gentleman from Arizona, Mr. Franks, is recognized for 3
+minutes.
+ Mr. Franks. Mr. Chairman, I know this isn't the appropriate
+venue to kind of dissect this legislation, but it occurs to me
+that in section 5, article III, 1, 2, the Malvo case is made
+very clear. Neither of these individuals involved in the sniper
+case could have legally purchased a gun in the first place, and
+so I think it's a red herring.
+ But the ultimate situation is that in the final analysis
+here, this is going to a deeper question in our country, and
+that is simply the right of people to own and bear arms and
+defend themselves and the right of manufacturers to manufacture
+weapons that can accomplish that. Ultimately, even those that
+are opponents of this bill would suggest that the police
+officers of this nation should have the ability to defend other
+people.
+ So with that statement made, it lays out very clearly that
+it's not the weapons, it's whose hands they are in. If we don't
+refocus our attentions as a nation into making sure that the
+people who misuse the weapons are our focus rather than the
+weapons, then we merely disarm the innocent and merely prevent
+people from being able to defend themselves, and I can suggest
+to you that criminals have always preferred unarmed victims,
+and that is at the core bases of this discussion.
+ Thank you, Mr. Chairman.
+ Mr. Cannon. Thank you.
+ The bell has not yet run. Mr. Delahunt, would you like to
+ask questions?
+ Mr. Delahunt. If the chair doesn't object.
+ Mr. Cannon. How could I object? I wish you were on our
+side, but what the heck. We'll do with the information we get,
+whatever----
+ Mr. Delahunt. I just want to pick up on something that the
+gentleman just talked about, a basic right and the Second
+Amendment. I want to assure you, I support the Second
+Amendment. But I also support what I consider as a basic right
+of a citizen who, if he or she feels that there has been an
+injury because of negligence or because of the actions of
+someone else, a basic right to the justice system, to the civil
+justice system. That is probably the core, most fundamental
+right that we enjoy as Americans, access to a justice system.
+ You know, the gentleman speaks of staggering sums. How much
+has been spent?
+ Mr. Beckman. Are you----
+ Mr. Delahunt. I'm speaking to the gentleman with the nice
+white hair. [Laughter.]
+ Mr. Beckman. Are you talking about for North American Arms
+specifically, or----
+ Mr. Delahunt. No. In other words, I'll tell you, I'm having
+real difficulty finding out what the problem is. You know, all
+I see is in the findings, I don't read anything about empirical
+data supporting a premise that the industry is going to go
+under.
+ Mr. Beckman. Well, respectfully, Congressman, we have other
+laws that preclude us from sharing all of our information among
+the manufacturers and distributors. So I can only speak to the
+company, or companies, that I have first-hand knowledge of.
+ Mr. Delahunt. Okay.
+ Mr. Beckman. And I can tell you that my client has spent
+hundreds and hundreds of thousands of dollars----
+ Mr. Delahunt. Defending lawsuits.
+ Mr. Beckman. Well, I'm talking about the municipal
+litigation. I'm not talking about----
+ Mr. Delahunt. All right. Now, you've won those suits,
+correct?
+ Mr. Beckman. Well, thus far, and where I have the problem
+with it, why I think that this legislation----
+ Mr. Delahunt. Could I ask you--let me just interrupt, okay?
+You represent a manufacturer.
+ Mr. Beckman. Yes, sir.
+ Mr. Delahunt. Would you have problems if manufacturers
+enjoyed this particular--the benefit of this legislation,
+because, you know, I dare say that the most obvious party in
+terms of responsibility and negligence would be the seller, the
+immediate seller. Now, if legislation were redrafted which
+would continue the common law as it applies to the distributor,
+the immediate seller, would you have a problem with that?
+ Mr. Beckman. I have a problem with holding--trying to hold
+somebody liable for damages that is very remote, because it is
+the same thing. We all know about the problems with drunk
+driving in this country, and if we start holding the auto
+manufacturers liable----
+ Mr. Delahunt. No, no, but you're not answering my question.
+I'm saying, let's use your analogy. What about the bartender,
+okay, that gives that customer who's obviously inebriated that
+extra drink, as opposed to the maker of the scotch that was
+consumed? Do you see a distinction there?
+ Mr. Beckman. Well, I do, and we have the Dram Shop Acts
+that----
+ Mr. Delahunt. I'm not asking about the Dram Shop Acts. I'm
+asking about the analogy between the producer of the whiskey
+and the bartender who sells it in terms of responsibility. Do
+you see a distinction there?
+ Mr. Beckman. I do. I do. I think that if you hold the
+manufacturer of the whiskey responsible, that's not----
+ Mr. Delahunt. But what about the bartender?
+ Mr. Beckman. If the bartender is serving somebody who's
+clearly inebriated, I think that's wrong.
+ Mr. Delahunt. Okay, and should be held liable?
+ Mr. Beckman. Indeed. If somebody is then injured by that
+drunk person, yes, I have no problem with----
+ Mr. Delahunt. Well, I guess that's what I'm suggesting in
+terms of the difference between the manufacturer and the seller
+in that gun store to that individual who comes in.
+ Mr. Beckman. Well, unless we have a vertically integrated
+industry where----
+ Mr. Delahunt. I'm not asking about vertical integration.
+I'm asking about the individual who sells the gun at the gun
+store, not--if you guys want to have a caucus, I'll be quiet
+here and you two can work out the answer. Can I just please ask
+the question without the gentleman whispering in your ear for
+just a moment, okay? I'm sure he's more than capable of giving
+me an answer.
+ Mr. Cannon. Do you want an answer to the question, or do
+you want to embarrass the witness, Bill?
+ Mr. Delahunt. Maybe both, but at least an attempt----
+ Mr. Beckman. Fortunately, I don't embarrass very easily.
+ Mr. Delahunt. No. At least an attempt at giving me an
+answer. There's a distinction between the manufacturer and the
+gun store.
+ Mr. Beckman. I think there's a great distinction between
+the manufacturer and the gun store, because you have somebody
+who is the proverbial--18 inches away----
+ Mr. Delahunt. I'm not----
+ Mr. Cannon. The gentleman's time has expired and we have a
+vote called----
+ Mr. Delahunt. Okay.
+ Mr. Cannon. --so if you don't mind, I'm going to give the
+gentleman a chance to answer the question and you can clarify a
+little bit if you want, but we probably do need to come to a
+close.
+ Mr. Delahunt. I'll do the clarification at a later time.
+ Mr. Beckman. To answer your question, the person who is 18
+inches away in a retail store, they have an obligation to
+comply with the law, and if they're selling through straw
+purchasers or if they're selling to somebody who is an
+unqualified buyer, that is a violation of the law and that is
+not something that is going to be barred under this statute.
+ Mr. Cannon. The gentleman's time having expired, Mr. Watt?
+ Mr. Watt. Mr. Chairman, Mr. Conyers has asked me to put
+some things in the record, so I ask unanimous consent to insert
+in the record a copy of the GAO report entitled, ``FBI Could
+Better Manage Firearm-Related Background Checks Involving
+Terrorist Watch List Records.''
+ Mr. Cannon. Without objection--oh, go ahead.
+ Mr. Watt. A copy of the bill that Mr. Conyers and
+Representative Chris Shays introduced in response to the GAO
+report; some information taken from a website which describes
+the Five-Seven as a 20-round pistol that fires a 5.7 millimeter
+bullet that will, quote, ``defeat most body armor in military
+service around the world today;'' a copy of the bill
+Representative Eliot Engel introduced which limits the use of
+the Five-Seven firearm; and some articles which highlight
+nearly a dozen or so assault weapons-related shootings which
+all occurred in the past 9 months, many of the shootings
+involving law enforcement officers.
+ Mr. Cannon. Without objection, so ordered.
+ [The material referred to is inserted in the Appendix.]
+ Mr. Cannon. I want to thank the panel for being here today.
+The language which you said has helped us frame the language of
+the debate that I think we're going to have. Actually, I think
+it was more interesting year than it was last cycle, so perhaps
+we can get to a vote in the House and also in the Senate and
+make this thing move forward.
+ I just want to, not having taken my 5 minutes, let me just
+make one point. That is, the hundreds of thousands of dollars
+that your company, Mr. Beckman, spent on defense of these
+lawsuits means the jeopardy of jobs in my district, and I would
+prefer that we keep liability the way it historically has been
+in America. That is personal, with personal responsibility, and
+I think this bill does that.
+ Thank you very much, gentlemen. This hearing is adjourned.
+ [Whereupon, at 11:27 a.m., the Subcommittee was adjourned.]
+
+
+ A P P E N D I X
+
+ ----------
+
+
+ Material Submitted for the Hearing Record
+
+ Prepared Statement of the Honorable Chris Cannon, a Representative in
+ Congress from the State of Utah, and Chairman, Subcommittee on
+ Commercial and Administrative Law
+
+ Good morning ladies and gentlemen; this hearing of the Subcommittee
+on Commercial and Administrative Law will now come to order. We
+consider today H.R. 800, the ``Protection of Lawful Commerce in Arms
+Act,'' which was introduced on February 15 by Representative Stearns.
+It currently has 157 co-sponsors, including myself.
+ H.R. 800 provides that a ``qualified civil liability action''
+cannot be brought in any State or Federal court. ``Qualified civil
+liability action'' is defined as a civil action or proceeding brought
+by any person against a manufacturer or seller of firearms or
+ammunition for damages resulting from the criminal or unlawful misuse
+of such products. However, such term does not include an action against
+a person who transfers a firearm or ammunition knowing that it will be
+used to commit a crime of violence or a drug trafficking crime, or a
+comparable or identical State felony law. It also does not include an
+action brought against a seller for negligent entrustment or negligence
+per se. The bill also includes several additional exceptions, including
+an exception for actions in which a manufacturer or seller of a
+qualified product knowingly and willfully violates a State or Federal
+statute applicable to sales or marketing when such violation was a
+proximate cause of the harm for which relief is sought. Other
+exceptions include actions for breach of contract or warranty in
+connection with the purchase of a firearm or ammunition; and an
+exception for actions for damages resulting directly from a defect in
+design or manufacture of a firearm or ammunition, when used as
+intended. The bill also makes clear that only licensed manufacturers
+and sellers are covered by the bill.
+ Tort law rests upon a foundation of personal responsibility in
+which a product may not be defined as defective unless there is
+something ``wrong'' with the product, rather than with the product's
+user. However, in the last several years, lawsuits have been filed
+against the firearms industry on theories of liability that would hold
+it liable for the actions of others who use their products in a
+criminal or unlawful manner. Such lawsuits threaten to separate tort
+law from its basis in personal responsibility, and to force firearms
+manufacturers into bankruptcy, leaving potential plaintiffs asserting
+traditional claims of product manufacturing defects unable to recover
+more than pennies on the dollar, if that, in federal bankruptcy court.
+While some of these lawsuits have been dismissed, and some states have
+acted to limit them in one way or another, the fact remains that these
+lawsuits continue to be aggressively pursued. In January, the Supreme
+Court refused to overturn a decision by the notorious Ninth Circuit
+Court of Appeals that allowed a frivolous lawsuit brought against gun
+manufacturers for a crime committed by a third party to go forward. One
+of the personal injury lawyers suing the firearms industry--John
+Coale--told The Washington Post--quote--``The legal fees alone are
+enough to bankrupt the industry.'' Professor David Kopel (Ko-PELL) has
+also stated that the cities suing the firearms industry--quote--``don't
+even have to win . . . All they have to do is keep suing . . . They'll
+kill [the industry] with the cost of defending all the lawsuits.''
+ Lawsuits seeking to hold the firearms industry responsible for the
+criminal and unlawful use of its products by others are attempts to
+accomplish through litigation what has not been achieved by legislation
+and the democratic process. As explained by one federal judge--quote--
+``the plaintiff's attorneys simply want to eliminate handguns.''
+ Under the currently unregulated tort system, personal injury
+lawyers are seeking to obtain through the courts stringent limits on
+the sale and distribution of firearms beyond the court's jurisdictional
+boundaries. Such a state lawsuit in a single county could destroy a
+national industry and deny citizens everywhere the right to keep and
+bear arms guaranteed by the Constitution. Insofar as these lawsuits
+have the practical effect of burdening interstate commerce in firearms,
+Congress has the authority to act under the Commerce Clause of the
+Constitution, as well as the Second Amendment.
+ Such lawsuits also directly implicate core federalism principles
+articulated by the Supreme Court, which has made clear that--quote--
+``one State's power to impose burdens on the interstate market . . . is
+not only subordinate to the federal power over interstate commerce, but
+is also constrained by the need to respect the interests of other
+States . . .''
+ If the judicial system is allowed to eliminate the firearms
+industry based on legal theories holding manufacturers liable for the
+misuse of their products, it is also likely that similar liability will
+be applied to an infinitely long list of other industries whose
+products are statistically associated with misuse. Where will it end?
+Knives are mostly used for nonviolent purposes, such as cooking, but
+hundreds of thousands of violent crimes every year are perpetrated with
+knives. We've already seen multi-million dollar lawsuits against the
+makers of hamburgers and steaks for damages caused when other people
+abuse those products and overeat. Surely the manufacturers of steak
+knives will be sued next when such knives are used for criminal
+purposes.
+ Congress must begin to stem the slide down this slippery slope. It
+can do that by fulfilling its constitutional duty and exercising its
+authority under the Commerce Clause to prevent a few state courts from
+bankrupting the national firearms industry and denying all Americans
+their fundamental right to bear arms. We need to preserve the benefit
+of American-made weapons for our soldiers overseas who are so ably
+defending all of us from terrorism. Let's not allow the American
+firearms industry to be bankrupted so we're left to rely on foreign
+countries to provide weapons for our own soldiers.
+ I now yield to Mr. Watt, the Ranking Member of the Subcommittee,
+for an opening statement.
+
+Prepared Statement of the Honorable Cliff Stearns, a Representative in
+ Congress from the State of Florida
+
+
+
+H.R. 1225, the ``Terrorist Apprehension and Record Retention (TARR) Act
+
+ of 2005''
+
+
+
+
+ GAO Report entitled ``GUN CONTROL AND TERRORISM: FBI Could Better
+Manage Firearm-Related Background Checks Involving Terrorist Watch List
+ Records
+
+
+
+ The ARMS site description of FN's Five-seveN Pistol
+
+
+
+ H.R. 1136, the ``Protect Law Enforcement Armor (PLEA) Act''
+
+
+
+ News Articles for the record offered by the Honorable John Conyers,
+ Jr., a Representative in Congress from the State of Michigan, and
+ Ranking Member, Committee on the Judiciary
+
+
+
+Response to Post-Hearing Questions from a Minority Member to Bradley T.
+ Beckman, Counsel, Beckman and Associates, Counsel to North American
+ Arms
+
+
+
+ Article submitted by Lawrence G. Keane, Counsel, Beckman and
+ Associates, Counsel to North American Arms
+
+
+
+ Op-Ed Article from New York Daily News, Sunday, January 9, 2005,
+ submitted by Lawrence G. Keane, Counsel, Beckman and Associates,
+ Counsel to North American Arms
+
+
+
+Letter from Walter Olson, Senior Fellow, Manhattan Institute for Policy
+ Research to the Honorable Chris Cannon
+
+
+
+
+
+